On October 29 of the current year, a company concluded that a customer's $4,400 account receivable was uncollectible and that the account should be written off. What effect will this write-off have on this company's net income and total assets assuming the allowance method is used to account for bad debts?

No effect on net income; no effect on total assets. T/F

Question

Business

Erica Bryant

8 March, 07:09

On October 29 of the current year, a company concluded that a customer's $4,400 account receivable was uncollectible and that the account should be written off. What effect will this write-off have on this company's net income and total assets assuming the allowance method is used to account for bad debts?

No effect on net income; no effect on total assets. T/F

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Answers (1)

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Grease · Answer 1

The answer is true

Explanation:

There will no effect on net income; no effect on total assets because an allowance method is used which means there was a provision for bad debts already effected.