Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 21 - No. 28)
What happens to the company's net profit when writing off uncollectible debts?
The profit remains the same.
The profit decreases.
The profit increases.
The profit depends on the amount written off.
Explanation
Writing off uncollectible debts results in an increase in expense, thereby decreasing net profit.
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