A company uses the allowance method to account for bad debts. What is the effect on each of the following accounts of the collection of an account previously written off? $\begin{array}{lcc}
&\text { Allowance for } & \text { Accounts } \
&\text { Uncollectible Accounts } & \text { Receivable } \
\text { a. } & \text { Increase } & \text { Decrease } \
\text { b. } & \text { No effect } & \text { Decrease } \
\text { c. } & \text { Increase } & \text { No effect } \
\text { d. } & \text { No effect } & \text { No effect }
\end{array}$

Question

Quizplus · Accepted Answer

When an account previously written off is collected, the Allowance for Uncollectible Accounts is increased (restored), and Accounts Receivable is not affected because it was already adjusted during the write-off.

A Company Uses the Allowance Method to Account for Bad