When Evaluating the Collectability of Accounts Receivable

question 67

Multiple Choice

When evaluating the collectability of accounts receivable:

• A)the Uncollectible-Account Expense is a contra account.
• B)the Allowance for Uncollectible Accounts is an operating expense in the selling,general and administrative category.
• C)the allowance method uses estimates developed from the company's collection experience.
• D)the direct write-off method uses the Allowance for Uncollectible Accounts to record bad debts.

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Definitions:

External Locus

The belief that outcomes in one's life are determined by external forces or circumstances beyond personal control.

Positive Attitude

A position resulting from healthy self-esteem, optimism, extraversion, and personal control.

Negative Attitude

The tendency to consistently view situations, people, and outcomes pessimistically or unfavorably.

Proportional

Characterized by or having parts in a precise or consistent relation in size, amount, degree, or intensity compared to something else.