Which of the Following Has Occurred Since the North American

question 172

Multiple Choice

Which of the following has occurred since the North American Free Trade Agreement (NAFTA) took affect in 1994?

• A) U.S. trade with both Mexico and Canada has increased.
• B) Employment in the United States is now slightly lower than before the agreement.
• C) Employment in the United States is now substantially higher than before the agreement.
• D) Both a and b are true.
• E) Both a and c are true.

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Definitions:

Allowance Method

An accounting technique used to account for bad debts, where an estimated amount is deducted from accounts receivable to reflect possible non-collection.

Bad Debts

are amounts owed to a company that are considered uncollectible, leading to a financial loss.

Percentage of Sales

A financial analysis tool used to forecast future expenses, based on a fixed percentage of the total sales.

Allowance for Doubtful Accounts

A contra asset account on a company's balance sheet that estimates the amount of receivables that may not be collected.