Response to the following questions:
1. What method of bad debt estimation categorizes individual accounts receivable based on the length of time outstanding? Why is this length of time an important factor
2. Why does the write-off of uncollectible accounts have no effect on the net realizable accounts receivable on the balance sheet if bad debts are estimated? What is the effect of this write-off on the income statement?
If possible, please give examples to better understand your response.