Which of the following is/are not a shortcoming of the direct write-off method?
A)It provides firms with an opportunity to manage earnings each period by deciding when particular customers' accounts become uncollectible.
B)It does not usually recognize the loss from uncollectible accounts in the period in which the sale occurs and the firm recognizes revenue.
C)The amount of accounts receivable on the balance sheet does not reflect the amount a firm expects to collect in cash.
D)It is the method required for income tax reporting in the United States.
E)none of the above.

Question

Quizplus · Accepted Answer

The direct write-off method being the method required for income tax reporting in the United States is not a shortcoming of the method itself. However, the other options listed are limitations of the direct write-off method.

Which of the Following Is/are Not a Shortcoming of the Direct