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

Under the allowance method, Bad Debts Expense is recorded based on an estimate of the amount that the company does not expect to collect, rather than waiting for specific accounts to be deemed uncollectible.

Under the Allowance Method for Uncollectible Accounts, Bad Debts Expense