Profile Corporation
the Following Data Concern Profile Corporation for 2012

question 79

Multiple Choice

Profile Corporation
The following data concern Profile Corporation for 2012.
Accounts receivable --january 1, 2012 $\quad\quad$ $\$250,000$
Credit sales during 2012 $\quad\quad$ $1,000,0000$
Collections from credit customers during 2012 $\quad\quad$ 750,000
Allowance far bad debts-jaruary 1,2012 $\quad\quad$ 20,000
Eitimated uncollected accounts based on an aging aralysis $\quad\quad$ 45,000
- Refer to the information provided for Profile Corporation. If the aging method is used to estimate bad debts, what amount should be recorded as bad debt expense for 2012?

• A) $45,000
• B) $20,000
• C) $25,000
• D) $15,000

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Definitions:

Production Efficiencies

The optimization of processes to maximize output while minimizing waste and costs.

Labor Costs

The total expenses incurred by a company for the compensation of its employees, including wages, benefits, and taxes.

Factory Depreciation

The decrease in value of manufacturing equipment and facilities over time due to wear and tear or obsolescence, considered an indirect cost of production.

Product Cost

The total expense incurred to create a product, including direct materials, labor, and overhead costs.