Which of the Following Statements Is incorrect

question 76

Multiple Choice

Which of the following statements is incorrect?

• A)Companies sell on account to increase total sales.
• B)Companies sell on account to remain competitive.
• C)Companies sell on account to generate additional forms of revenue.
• D)Companies sell on account to increase bad debt expense.

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Definitions:

Postage Stamps

These are adhesive labels issued by postal authorities to prepay for the delivery of mail.

Travelers' Checks

Preprinted, fixed-amount checks designed to allow the person signing it to make an unconditional payment to someone else as a result of having paid the issuer for that privilege.

NSF Check

A cheque that cannot be processed because the drawer's account does not have sufficient funds.

Credit Memos

Issued by a seller to a buyer, reducing the amount the buyer owes under certain conditions, like returned goods or a pricing dispute.