A major shortcoming of the direct write-off method is that credit losses are:

Question

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Under the direct write-off method, doubtful accounts are charged to the bad debts expense on the income statement in the period in which the accounts are determined to be uncollectible. Under this approach, there is no attempt to estimate the bad debts expense, nor is there any attempt to match this expense with sales revenues in the period in which the credit sales transaction originally occurred.

A Major Shortcoming of the Direct Write-Off Method Is That