Buttercup Florist uses the allowance method to account for uncollectible accounts. Unable to collect a $150 account from a customer, Buttercup determined it was uncollectible. How would the write-off of this account affect the elements of the company's financial statements?

Question

Shaun Moreno

Business

23 November, 09:24

Buttercup Florist uses the allowance method to account for uncollectible accounts. Unable to collect a $150 account from a customer, Buttercup determined it was uncollectible. How would the write-off of this account affect the elements of the company's financial statements?

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Answers (1)

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Gordon Potter · Answer 1

B. NA = NA + NA NA? NA = NA NA

Explanation:

Since in the question it is given that the Buttercup Florist uses the allowance method for accounting the uncollectible accounts due to which the company is able to collect $150 from the customer

So this transaction does not affect the financial statements as on one side the asset side is decreased and on the asset side there is an increase in account receivable due to decrease in allowance for doubtful accounts