In estimating the amount of uncollectible accounts the accountant (1) estimates the amount of uncollectible accounts that will likely occur over time in connection with sales of each period and (2) makes an entry debiting Bad Debt expense and crediting Allowance for Uncollectible Accounts.The name of this procedure is/are the
A)percentage-of-sales.
B)aging-of-accounts-receivable.
C)direct write-off.
D)indirect write-off.
E)tax accounting.

Question

Quizplus · Accepted Answer

The percentage-of-sales method estimates uncollectible accounts based on a percentage of sales, and involves making an entry to debit Bad Debt Expense and credit Allowance for Uncollectible Accounts.

In Estimating the Amount of Uncollectible Accounts the Accountant (1)