The write-off of specific customers' accounts using the allowance method has no effect on the income statement.

Question

Quizplus · Accepted Answer

The write-off of specific customers' accounts has no effect on the income statement because the allowance for doubtful accounts was already established in a previous accounting period. Therefore, the write-off results in a decrease in accounts receivable and the allowance account, but there is no direct impact on the income statement.

The Write-Off of Specific Customers' Accounts Using the Allowance Method