Which of the following methods may not be appropriate for estimating bad debt expense?

Question

Quizplus · Accepted Answer

Percentage of sales may not be appropriate for estimating bad debt expense as it does not take into account the outstanding accounts receivable or the age of the accounts. It only considers the total sales amount for the period, which may not be a reliable indicator of the actual bad debt expense. The other methods (percentage of net credit sales, percentage of outstanding accounts receivable, and aging of accounts receivable) all consider the outstanding accounts receivable and its age, which are important factors in estimating bad debt expense.

Which of the Following Methods May Not Be Appropriate for Estimating