Under the allowance method for uncollectible accounts, Bad Debts Expense is recorded
A)when an individual account is written off.
B)when the amount of loss is known.
C)for an amount that the company estimates it will not collect.
D)several times during the accounting period.

Question

Quizplus · Accepted Answer

Bad Debts Expense is recorded for an amount that the company estimates it will not collect under the allowance method for uncollectible accounts. The estimated amount is recorded before any individual accounts are written off, and the actual losses are determined through the adjustment of the allowance account at the end of the accounting period.

Under the Allowance Method for Uncollectible Accounts, Bad Debts Expense