When a Company Is Using the Direct Write-Off Method,and an Account

question 192

Multiple Choice

When a company is using the direct write-off method,and an account is written off,the journal entry consists of a ________.

• A) debit to Accounts Receivable and a credit to Cash
• B) credit to Accounts Receivable and a debit to Bad Debts Expense
• C) debit to the Allowance for Bad Debts and a credit to Accounts Receivable
• D) credit to Accounts Receivable and a debit to Interest Expense

---

Definitions:

Skilled Worker

An individual who has specialized training and expertise in a particular trade or profession, often requiring formal education or certification.

Labour Cost

Labour cost is the total expense incurred from employing labor, including wages, benefits, and taxes, significant in assessing overall production costs or operational expenses.

Practical Standard

A level of performance or an expectation that is realistic and attainable under normal circumstances.

Labour Efficiency Variance

The difference between actual labor hours worked and the standard labor hours expected for the level of production achieved.