When Comparing the Direct Write-Off Method and the Allowance Method

Multiple Choice

When comparing the direct write-off method and the allowance method of accounting for uncollectible receivables, a major difference is that the direct write-off method

A) uses a percentage of sales method to estimate uncollectible accounts.
B) is used primarily by large companies with many receivables.
C) is used primarily by small companies with few receivables.
D) uses an allowance account.