Question

Under the allowance method, when a specific account is written off

a. total assets will be unchanged.
b. net income will decrease.
c. total assets will decrease.
d. total assets will increase.

Answer 1

When engaging to the allowance method, when there is a presence of having to written off a specific amount in the allowance method, what would likely happen is that there will be no change in terms of the total assets so the likely answer is letter a.