Asked by Griselle Gomez on May 26, 2024
Verified
If the allowance method of accounting for uncollectible receivables is used, what general ledger account is debited to write off a customer's account as uncollectible?
A) Uncollectible Accounts Expense
B) Allowance for Doubtful Accounts
C) Accounts Receivable
D) Interest Expense
Allowance Method
An accounting technique used to estimate and account for bad debts or credit losses.
Uncollectible Accounts Expense
This refers to the expense recorded by a business to cover debts that are not expected to be collected due to customers being unable to pay.
- Master the concepts of the allowance method used for handling uncollectible accounts in accounting.
Verified Answer
EA
Elhussein AhmedMay 29, 2024
Final Answer :
B
Explanation :
The Allowance for Doubtful Accounts is debited when writing off a customer's account as uncollectible under the allowance method, which reduces the allowance account and the accounts receivable account without affecting the income statement at the time of the write-off.
Learning Objectives
- Master the concepts of the allowance method used for handling uncollectible accounts in accounting.
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