Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 22 - No. 16)
What is the impact of writing off an uncollectible account on a company's net income?
Increases net income.
Decreases net income.
Has no impact on net income.
Increases assets.
Explanation
Writing off a bad debt reduces Accounts Receivable and the Allowance for Doubtful Accounts, but doesn't impact net income (expense was already recorded).
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