The Following Information Is Related to December 31, 2016 Balances

question 126

Multiple Choice

The following information is related to December 31, 2016 balances. $\begin{array}{lc}\text { Accounts receivable } & \$ 3,150,000 \\\text { Allowance for doubtful accounts (credit) } & (270,000) \\\text { Cash realizable value } & \$ 2,880,000\end{array}$ During 2017 sales on account were $870,000 and collections on account were $516,000. Also during 2017 the company wrote off $48,000 in uncollectible accounts. An analysis of outstanding receivable accounts at year end indicated that bad debts should be estimated at $324,000. Bad debt expense for 2017 is

• A)$102,000.
• B)$ 54,000.
• C)$324,000.
• D)$ 6,000.

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Definitions:

Direct Approach

A communication style where the main point or purpose is presented at the beginning, followed by supporting details or arguments.

Indirect Approach

A communication strategy that involves presenting background information before getting to the main point, often used to soften negative news or messages.

Direct Approach

A straightforward method of communication or action without any deviation or subtlety.

Negative News

Information or updates that convey adverse, unfavorable, or unwanted situations, events, or outcomes.