Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 38 - No. 24)
What is the primary benefit of the allowance method over the direct write-off method for accounting for bad debts?
It simplifies the accounting process.
It better matches revenues and expenses in the same accounting period.
It is easier to implement.
It results in a lower tax liability.
Explanation
The matching principle is a core tenet of accounting.
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