If the Direct Write-Off Method of Accounting for Uncollectible Receivables

question 112

Multiple Choice

If the direct write-off method of accounting for uncollectible receivables is used, what general ledger account is credited to write off a customer's account as uncollectible?

• A) Bad Debt Expense
• B) Accounts Receivable
• C) Allowance for Doubtful Accounts
• D) Interest Expense

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Definitions:

Current Shareholder

An individual or entity that currently owns shares in a company.

Derivative Action

A lawsuit brought by a corporation's shareholder(s) on behalf of the corporation against a third party, often the corporation's executives or directors, when the corporation fails to take action.

Suing Shareholders

The act of taking legal action against the shareholders of a company, typically relating to disputes over management decisions, violations of shareholder agreements, or breaches of fiduciary duties.

Corporate Treasury

The division of a corporation that manages the company's liquidity, financing activities, and financial risk.