Managerial Accounting - direct write-off method
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A company has significant uncollectible receivables. Why is the direct write-off method acceptable?
A) Assets are overstated on the balance sheet
B) It violates the matching principle
C) Both A & B are true
D) Neither A nor B are true
E) None of the above
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The expert examines direct write-off methods for managerial accounting.
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Answer to your question is provided herewith. It is also attached in a separate word document.
C) Both A & B are true
Under direct write off method bad debt expenses are recorded in the year in which accounts receivable actually prove bad or unrecoverable. In other words it is ...
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