Consider Two Processes

question 40

Multiple Choice

Consider two processes. If both versions create the same benefit, but one costs more than the other, the higher-cost version is less ________ than the lower-cost version.

• A) effective
• B) work
• C) timely
• D) efficient

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Definitions:

Bad Debt Expense

An anticipated expense recorded in the accounts to allow for customers' debts that have been deemed unrecoverable.

Journal Entries

Records of financial transactions in the accounting system, showing accounts affected, amounts, and date.

Allowance Account

An account used in accounting to reflect anticipated losses from accounts receivable that might not be collected.

Direct Write-Off Method

A method of accounting for bad debts whereby companies directly remove (write off) uncollectible amounts from accounts receivable when they are deemed uncollectible.