Bad debts are recognized according to which of the following expense recognition principles?
A) Immediate recognition
B) Direct matching
C) Systematic and rational allocation
D) Critical event recognition

Question

Quizplus · Accepted Answer

Bad debts are recognized by using the direct matching principle, where the estimated bad debts are matched with the related revenue in the same accounting period. This follows the principle of recognizing expenses in the same period as related revenues.

Bad Debts Are Recognized According to Which of the Following