Chapter 5, Problem 14RQ

To determine

Allowance method for uncollectible accounts:

It is a method for accounting bad debt expense, where uncollectible accounts receivables are estimated, and recorded at the end of particular period. Under this method, bad debts expenses are estimated and recorded prior to the occurrence of actual bad debt, in compliance with matching principle by using the allowance for bad debt account.

To discuss: The manner in which uncollectible accounts receivable is write-off and to report the effects in total assets and net income.