When a specific customer account is written off under the allowance method, Bad Debts Expense is:
A) debited.
B) not affected.
C) credited.
D) None of these answers is correct.

Question

Quizplus · Accepted Answer

Under the allowance method, when a specific customer account is written off, Bad Debts Expense is not affected because the expense was already recognized when the allowance for doubtful accounts was established. The write-off involves a reduction in the accounts receivable and the allowance for doubtful accounts, not the bad debts expense.

When a Specific Customer Account Is Written Off Under the Allowance