One Might Infer from a Debit Balance in Allowance for Doubtful

question 134

Multiple Choice

One might infer from a debit balance in Allowance for Doubtful Accounts that

• A) the percentage of receivables basis is being used.
• B) bad debts expense has been overestimated.
• C) a posting error has been made.
• D) more accounts have been written off than had been estimated.

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Definitions:

Narrowing

The process of reducing or limiting the scope or breadth of something.

Expansion

The process of increasing in size, volume, quantity, or scope.

Very Sleepy

A state of experiencing extreme tiredness or drowsiness, often implying a need for rest or sleep.

Functioning

The action of operating or working in a proper manner; pertains to how well an individual or system performs its intended role.