Allowance for Doubtful Accounts Has a Debit Balance of $500

question 47

Multiple Choice

Allowance for Doubtful Accounts has a debit balance of $500 at the end of the year,before adjustments.Sales for the year amounted to $870,000,sales discounts amounted to $30,000 and sales returns and allowances amounted to $40,000.If the uncollectible accounts expense is estimated at 2% of net sales,the balance in the Allowance for Doubtful Accounts after the entry to record estimated losses from uncollectible accounts will be

• A) $17,400
• B) $16,500
• C) $16,000
• D) $15,500

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Definitions:

Perceptual Constancy

The brain's ability to recognize objects as remaining the same despite changes in distance, viewpoint, or lighting conditions.

Linear Perspective

A technique in visual art, particularly drawing and painting, to create the illusion of depth and distance on a flat surface, using converging parallel lines.

Opponent-Process Theory

A psychological and neurological model that explains how the perception of colors is controlled by the operation of opposing neural systems.

Afterimages

Visual illusions that continue to appear in one's vision after the exposure to the original image has ceased.