Question: When the allowance method of recognizing bad debt expense is used, the entries at the time of collection of a small account previously written off

When the allowance method of recognizing bad debt expense is used, the entries at the time of collection of a small account previously written off would:

  • Decrease net income
  • Increase net income
  • Increase Allowance for Bad Debts
  • Decrease Allowance for Bad Debts

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