TechCom Has $40,000 in Outstanding Accounts Receivable

question 21

True/False

TechCom has $40,000 in outstanding accounts receivable. Past experience suggests that 5% of outstanding receivables are uncollectible. The current balance in the allowance for doubtful accounts is $2,500 debit. The required adjusting journal entry includes a debit to bad debt expense for $4,500.

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Definitions:

Resources

Assets or materials that can be drawn upon by a person or organization in order to function effectively.

Stakeholders

Individuals or groups that have an interest or stake in the success and activities of a company or project.

Universalization Test

A philosophical concept used in ethics to determine if an action's principle can be applied universally without contradiction.

Universalization Test

A principle in ethics asking whether an action's rationale could be universally applied, contributing to evaluating its moral worth.