If the direct write-off method of accounting for uncollectible receivables is used, what general ledger account is credited to write off a customer's account as uncollectible?
A) Uncollectible Accounts Expense
B) Accounts Receivable
C) Allowance for Doubtful Accounts
D) Interest Expense

Question

Quizplus · Accepted Answer

The direct write-off method involves directly writing off accounts receivable when they are deemed uncollectible. Therefore, the general ledger account that is credited to write off a customer's account as uncollectible would be Accounts Receivable. Option A, Uncollectible Accounts Expense, is a general ledger account that is used under the allowance method of accounting for uncollectible receivables. Option C, Allowance for Doubtful Accounts, is a contra-asset account that is used under the allowance method. Option D, Interest Expense, is not related to the accounting treatment of uncollectible receivables.

If the Direct Write-Off Method of Accounting for Uncollectible Receivables