When the allowance method is used,the journal entry to write-off an uncollectible account does not change the amount reported as net accounts receivable on the balance sheet.
BT: Comprehension

Question

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This statement is true. The allowance method involves creating an allowance for doubtful accounts to anticipate uncollectible accounts, and the write-off of an uncollectible account reduces the allowance, not the net accounts receivable reported on the balance sheet.

When the Allowance Method Is Used,the Journal Entry to Write-Off