The end of period adjusting entry for bad debt expense under the direct write-off method is:

Question

Quizplus · Accepted Answer

The direct write-off method does not require an adjusting entry for bad debt expense. Instead, bad debts are simply written off as they occur. This method is not permitted under Generally Accepted Accounting Principles (GAAP) due to its lack of accuracy and matching principle. Instead, the allowance method is the preferred method for accounting for bad debts.

The End of Period Adjusting Entry for Bad Debt Expense