Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 23 - No. 33)
What is the impact on the balance sheet when writing off an uncollectible debt?
Increases assets and decreases liabilities.
Decreases assets and increases equity.
Decreases assets and decreases liabilities.
Increases assets and increases liabilities.
Explanation
Write-off decreases the asset (accounts receivable) and decreases the provision for doubtful debts (a contra-asset).
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