The expense recognition principle, as applied to bad debts, requires:
A. That bad debts not be written off.
B. The use of the allowance method of accounting for bad debts.
C. That expenses be ignored if their effect on the financial statements is unimportant to users' business decisions.
D. That bad debts be disclosed in the financial statements.
E. The use of the direct write-off method for bad debts.
Answer: B
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