Direct write-off method
In accounting, direct write-off method means charging a receivable to bad debt expense only when it is judged uncollectible, with no allowance. Not GAAP where expected credit losses are material; the federal tax rule works the same way (specific charge-off).
Authority: ASC 326-20 (opens in a new tab). Sources
The lesson that teaches this
From the free founder back-office course, taught on one company's books, with exercises to work it yourself.
For founders
The same idea written for a founder: what it costs a startup that ignores it, and what to do in a real month.
What it is not called
Each of these means something else. Use one here and an accountant reading the product notices.
- allowance method
- write-off alone
Nearby in the catalog
No component names this concept outright. These sit in the same part of the system.
Also in Receivables
Defined in Lexicon. This page is generated from that document, so the two can't disagree.