Question

The income statement approach to estimating uncollectible accounts is called the​ ________ method. The balance sheet approach to estimating uncollectible accounts is called the​ ________ method.

Answer 1

Answer:

The income statement approach to estimating uncollectible accounts is called the​ Direct write off  method. The balance sheet approach to estimating un-collectible accounts is called the​ Allowance method.

An allowance method in financial terms is a method that records the expenses on the bad debt in the same period as that of the sales.

The Direct write-off method refers to the financial concept of bad debt that arises through the credit sales. An account receivable is written-off directly to the expense section but that too only when the account is deemed un-collectible.