It Is a New Day at the Firm

question 10

Multiple Choice

It is a new day at the firm. Roark has been in place for a few weeks, strengthening the communications skills of his employees, getting them to work much better together. Now, the challenge that he faces is not an internal one; it lies with the client, which is increasingly showing itself to be incapable of sticking with decisions. Roark, based on his past experience with other clients like this, is afraid that the client will throw them a curveball and want to make changes late in the game - but that they also will be unwilling to absorb the costs of those changes. For this reason, Roark eliminates which of the following methods of development?

• A) structured analysis
• B) agile/adaptive methods
• C) object-oriented analysis
• D) rapid application development

---

Definitions:

Income Statement Approach

A method for creating an adjusting entry for bad debts by estimating uncollectible accounts based on income statement figures.

Aging

The process of categorizing accounts receivable based on how long an invoice has been outstanding to determine credit risk.

Direct Write-Off Method

An accounting method used to recognize bad debts at the point when specific accounts are deemed uncollectible, directly impacting the income statement.

Allowance Method

An accounting technique used to manage accounts receivable and bad debt by estimating uncollectible accounts at the end of each period.