Under the allowance method, writing off an uncollectible account

A) affects only balance sheet accounts.

B) affects both balance sheet and income statement accounts.

C) affects only income statement accounts.

D) is not acceptable practice.

Question

Business

Fatima Carrillo

8 August, 10:25

Under the allowance method, writing off an uncollectible account

A) affects only balance sheet accounts.

B) affects both balance sheet and income statement accounts.

C) affects only income statement accounts.

D) is not acceptable practice.

+5

Answers (1)

Know the Answer?

Nicolas Bryan · Answer 1

The correct option is A

Explanation:

The allowance method is the method in which the uncollectible accounts receivable procedure which records or reports the estimate of the bad debt expense in the same accounting year or period as the sale.

Under this method, the uncollectible amount is computed by dividing the debt amount with the aggregate accounts receivable and multiply by 100.

This method is used to adjust the accounts receivable which appears on the balance sheet. Therefore, only affects the balance sheet accounts.

Under the allowance method, writing off an uncollectible accountA) affects only balance sheet accounts.B) affects both balance sheet and income statement accounts.C) affects only income statement accounts.D) is not acceptable practice.

Under the allowance method, writing off an uncollectible account

A) affects only balance sheet accounts.

B) affects both balance sheet and income statement accounts.

C) affects only income statement accounts.

D) is not acceptable practice.