Final answer:
The method that emphasizes asset valuation for estimating uncollectible accounts is aging the receivables. It categorizes receivables by age and assigns a probability of non-payment based on how long they have been outstanding, different from the direct write-off method which impacts income when specific accounts are marked as uncollectible.
Step-by-step explanation:
The method of estimating uncollectible accounts that emphasizes asset valuation rather than income measurement is aging the receivables. This method involves analyzing accounts receivable based on the length of time they have been outstanding. Receivables are categorized by age, such as current, 1-30 days past due, 31-60 days past due, etc. Each category is then assigned a probability of being uncollectible, with older receivables generally having a higher risk of non-payment.
The direct write-off method, on the other hand, recognizes bad debts only when specific accounts are deemed uncollectible, which affects income measurement rather than asset valuation. This method is not as accurate as aging the receivables because it does not account for the likelihood of non-collection based on the age of the accounts.
Using credit sales less returns and allowances or gross sales for estimating uncollectible accounts are methods that emphasize income measurement over asset valuation, focusing on a percentage of sales as the basis for estimating bad debts.