A Company Has an Ending Accounts Receivable Balance of $1,800,000

question 95

Multiple Choice

A company has an ending accounts receivable balance of $1,800,000 and it estimates that uncollectible accounts will be 2% of the receivable balance. If Allowance for Doubtful Accounts has a credit balance of $4,000 prior to adjustment, its balance after adjustment will be a credit of

• A)$40,000.
• B)$36,000.
• C)$35,920.
• D)$32,000.

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Definitions:

Supply

The total amount of a product or service that is available to consumers, often influenced by price, production costs, and external factors.

Labor Union

An organization of workers formed to protect and advance their rights and interests, typically through collective bargaining.

Excess Supply

A situation where the quantity of a product offered by producers exceeds the quantity demanded by consumers, leading to surplus.

Equilibrium Market Wage

Another term for the wage rate at which the quantity of labor demanded equals the quantity supplied, ensuring labor market balance without excess supply or demand.