Under the Direct Write-Off Method,what Adjustment Is Made at the End

question 55

Multiple Choice

Under the direct write-off method,what adjustment is made at the end of the year to account for possible future bad debts?

• A)Debit Bad Debt Expense.
• B)Debit Allowance for Uncollectible Accounts.
• C)Credit Accounts Receivable.
• D)No adjustment is made.

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Definitions:

Sales

The total amount of a company's revenue generated from goods or services sold over a designated period.

Cash Collections

The activity of gathering and receiving cash payments from customers or clients, often related to sales or services provided.

Selling Price

The amount of money charged to the customer for a product or service.

Credit Sales

Sales made by a business allowing the buyer to pay at a later date.