Which method requires first estimating the desired amount for the Allowance for Doubtful Accounts and then determining the amount of the expense required to get to this desired balance given the amount of the unadjusted balance?
A)Aging of accounts receivable method
B)Percentage of credit sales method
C)Direct write-off method
D)Percentage of bad debts method

Question

Quizplus · Accepted Answer

Allowance method is a method of accounting that reduces accounts receivable (as well as net income)for an estimate of uncollectible accounts (bad debts).

Which Method Requires First Estimating the Desired Amount for the Allowance