Owens Company Uses the Direct Write-Off Method of Accounting for Uncollectible

question 97

Essay

Owens Company uses the direct write-off method of accounting for uncollectible accounts receivable.On December 6,Year 1,Owens sold $6,300 of merchandise to the Valley Company.On August 8,Year 2,after numerous attempts to collect the account,Owens determined that the account of the Valley Company was uncollectible.
a.Prepare the journal entry required to record the transactions on August 8.
b.Assuming that the $6,300 is material,explain how the direct write-off method violates the expense recognition principle in this case.

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The process by which cancer cells spread from the original site to other parts of the body, forming new tumors.

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Refers to the presence and growth of cancer cells that have the potential to spread from their origin to other parts of the body.

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