Which statement regarding the direct write-off method of bad debts is untrue?

Question

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The statement "Bad debts are matched against the related sales revenue" is untrue for the direct write-off method. In this method, bad debts are expensed as soon as they are identified as uncollectible, regardless of their relationship to the associated sales revenue. This method does not provide an accurate matching of expenses with revenues, which is a key principle of accrual accounting.

Which Statement Regarding the Direct Write-Off Method of Bad Debts