Question

When comparing the direct​ write-off and allowance​ methods, the major difference is​ _________. A. determining the balance of the Allowance for Bad Debts account B. when to recognize revenue C. developing adequate procedures for granting credit D. when to record bad debts expense

Answer 1

When comparing the direct​ write-off and allowance​ methods, the major difference is determining the balance of the Allowance for Bad Debts account

Step-by-step explanation:

Direct write-off method vs allowance method. Under the direct write-off method, a bad debt is charged to expense as soon as it is apparent that an invoice will not be paid. Under the allowance method, an estimate of the future amount of bad debt is charged to a reserve account as soon as a sale is made