Use the Following Selected Information from Wheeler,LLC to Determine the 2015

question 191

Multiple Choice

Use the following selected information from Wheeler,LLC to determine the 2015 and 2014 common size percentages for cost of goods sold using Net sales as the base.

• A)36.4% for 2015 and 41.1% for 2014.
• B)55.0% for 2015 and 56.0% for 2014.
• C)119.4% for 2015 and 100.0% for 2014.
• D)117.2% for 2015 and 100.0% for 2014.
• E)65.1% for 2015 and 56.0% for 2014.

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Definitions:

Allowance Method

An accounting technique used to adjust accounts receivable for the portion that is estimated to be uncollectible.

Bankruptcy Notice

A legal document issued by a court or a legal authority indicating that an individual or entity has declared bankruptcy, outlining the conditions and implications.

Write-Off

The accounting action of declaring that an asset, typically accounts receivable, is uncollectible and removing its value from the books.

Estimated Bad Debts

A provision for accounts receivable that are not expected to be collected.