Under the allowance method for uncollectible accounts
A)the net realizable value of accounts receivable is greater before an account is written off than after it is written off.
B)Bad Debts Expense is debited when a specific account is written off as uncollectible.
C)the net realizable value of accounts receivable in the statement of financial position is the same before and after an account is written off.
D)Allowance for Doubtful Accounts is closed each year to Income Summary.

Question

Quizplus · Accepted Answer

Under the allowance method, the net realizable value of accounts receivable remains the same before and after an account is written off because the write-off reduces both the accounts receivable and the allowance for doubtful accounts by the same amount.

Under the Allowance Method for Uncollectible Accounts