How does the direct write-off method differ from the allowance method?

• A. The direct write-off method records bad debt when uncollectible, while allowance estimates in advance.
• B. The direct write-off method requires an allowance account, while the allowance method does not use one.
• C. The direct write-off method is GAAP-compliant, while the allowance method is not acceptable for public companies.
• D. The direct write-off method is more accurate and reliable than the allowance method for reporting.

Answer: (A)