Question

Under GAAP, the expense associated with the uncollectibility of accounts receivable is typically calculated and recorded based upon estimations of uncollectibility.

A.True
B.False

Answer 1

Under GAAP, the expense associated with uncollectible accounts receivable is based on estimations of uncollectibility.

Step-by-step explanation:

Under GAAP, the expense associated with the uncollectibility of accounts receivable is typically calculated and recorded based upon estimations of uncollectibility.

This means that companies predict how much of their accounts receivable may not be collected and record an expense to account for these potential losses. This estimation is usually based on historical data, industry averages, and other relevant factors.

Therefore, the statement in the question is True. The expense associated with the uncollectibility of accounts receivable under GAAP is indeed calculated and recorded based upon estimations of uncollectibility.