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A company with significant amounts of accounts receivable experiences uncollectible accounts from time to time. If the company uses the direct write-off method, the effect of writing off an uncollectible receivable will be ________.
A. a generation of positive cash flow
B. a reduction in net income
C. negligible on net income
D. an increase in total assets

Respuesta :

sandlee09

Answer:

reduction in net income

Explanation:

Based on the information provided within the question it can be said that this will be a reduction in net income. This is because a direct write-off represents a bad dept expense and removes it from the final profit that the company received. Which is the net income, therefore the final value is reduced.

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