Question

bad debt written of in final account

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Answer 1

Answer:

Under the allowance method, if a secific customer's accounts receivable is identified as uncollectible, it is written off by removing the amount from Accounts Receivable. The entry to write off a bad account affects only balance sheet accouts: a debit to Allowance for Doubtful Accounts and a cAccounts Receivable. No expense or loss is reported on the income statement because this write-off is "covered" under the earlier adjusting e