The allowance method and the direct write-off method are both methods of aging accounts receivable.

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The allowance method estimates uncollectible accounts as a percentage of accounts receivable, while the direct write-off method records bad debts only when specific accounts are deemed uncollectible. Aging accounts receivable is a technique used to estimate the allowance for doubtful accounts, not a method for writing off bad debts.

The Allowance Method and the Direct Write-Off Method Are Both