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A disadvantage of basing bad expense on the historical between actual bad debts and the outstanding accounts receivable balance at the end off the year
A disadvantage of basing bad expense on the historical between actual bad debts and the outstanding accounts receivable balance at the end off the year is that: a. it may not recognize the cause and effect relationship between expenses and revenues. b. it may not result in a reasonable estimate of the net reliable value of receivables. c. its not a general accepted accounting procedure. d. it is an income statement approach.
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