Proper accounting requires that an account receivable must be written off by the client when
A)the client company concludes that an amount is no longer collectible.
B)the customer files for bankruptcy.
C)a collection agency cannot inspire the customer to pay the debt.
D)the account is at least six months old.

Question

Quizplus · Accepted Answer

An account receivable must be written off when the client company concludes that an amount is no longer collectible. This is because it is no longer considered an asset that can be recovered and will instead be classified as a loss. The other options may also lead to a write-off, but they are not the only conditions that require a write-off.

Proper Accounting Requires That an Account Receivable Must Be Written