The aging-of-receivables method for estimating uncollectible accounts:
A)results in an immediate write-off of receivables that are more than 90 days past due.
B)focuses on the amount of receivables that will not be collected.
C)uses a balance sheet approach.
D)B and C.

Question

Quizplus · Accepted Answer

The aging-of-receivables method focuses on determining the amount of receivables that may not be collected, which is a balance sheet approach. Therefore, option B and C are correct. It does not necessarily result in an immediate write-off of receivables that are more than 90 days past due, so option A is incorrect.

The Aging-Of-Receivables Method for Estimating Uncollectible Accounts