Question

Under the allowance method, a. bad debt expense is recorded when specific customer accounts are determined to be uncollectible. b. the allowance account is used, but estimates are not. c. primary users are small companies with few receivables. d. the allowance account and estimates are used.

Answer 1

d. the allowance account and estimates are used.

Step-by-step explanation:

a. bad debt expense is recorded when specific customer accounts are determined to be uncollectible. FALSE

The whole point of using allowance is to avoid this

the entry for write-off is

allowance debit

account receivable credit

we use the bad debt expense for the estimates of the allowance base on account receivable, aging of the accounts receivable or a percent of sales.