Which of the following method is not acceptable under both IFRS and ASPE?
A)Percentage of sales method
B)Direct write-off method
C)Aging of accounts receivable
D)None of the above

Question

Quizplus · Accepted Answer

The direct write-off method is not acceptable under both IFRS and ASPE as it does not accurately reflect the timing of the recognition of bad debts expense. Instead, the allowance method (including the aging of accounts receivable) is required to be used. A is not the best choice as the percentage of sales method can be used but requires careful consideration of historical credit losses and changes in credit policies. D is not the best choice as none of the methods are unacceptable under both IFRS and ASPE.

Which of the Following Method Is Not Acceptable Under Both