Acc 291 week 1 DQ - Acc 291 week 1 DQ How are bad debts...

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Acc 291 week 1 DQ How are bad debts accounted for under the direct write-off method?As I understand it, the direct write-off method is very close to real-time in that as soon as the company determines that a debit is noncollectable it is recorded as such. Right up until that time, the debit is considered a viable asset.The alternative is to set aside some of the receivables in anticipation of the fact that a certain number of accounts will not be collectible. This provides a buffer that smooths things out and prevents management from overestimating the true value of their receivables. For this reason, this is the method that is used whenever bad debt risk is significant (material).Describe the allowance method?The allowance method for uncollectible accounts involves estimating uncollectible amounts at the end of each period. Companies must use this method for financial reporting purposes. Companies estimate the uncollectible accounts receivable and match them against revenues in the same accounting period in which the revenue was recorded. An adjusting entry is made at the end of the period to increase (debit) bad debt expense and increase (credit) allowance for doubtful accounts.At the time the specific accounts is written-off as uncollectible, the company debits actual uncollectibles and credit accounts receivable.When would it be appropriate for a company to lower its allowance for doubtful accounts as a percentage of its receivables?Companies normally should review receivables on a regular and periodic basis to determine their collectability. They would use a consistent method for analyzing this risk and determining what they feel is a reasonable amount to have in the Allowance for Uncollectible A/R account. If a large account that had been deemed to be at high risk for uncollectibility and thus had resulted in a large amount being credited to the Allowance account in anticipation of this default but suddenly took a turn for the better (perhaps the company was recapitalized) and the risk has been significantly mitigated, then a reduction to the Allowance account (given all other accounts remained stable) would be justified.What are the basic issues related to accounting for intangible assets?I have a particular interest in 'intangible' assets.

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