The percentage of sales basis for estimating uncollectible accounts always results in more Bad Debt Expense being recognized than the percentage of receivables basis.

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emily juliano · Accepted Answer

Final Answer : False, Explanation :  The percentage of receivables basis results in more Bad Debt Expense being recognized because it takes into account the estimated uncollectible amounts at the end of the reporting period based on the balance in accounts receivable, while the percentage of sales basis only considers the estimated uncollectible amounts based on credit sales made during the period.

The percentage of sales basis for estimating uncollectible accounts always results in more Bad Debt Expense being recognized than the percentage of receivables basis.

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