Which of the Following Statements Is False Regarding the Different

question 125

Multiple Choice

Which of the following statements is false regarding the different bases used for the allowance method?

• A) Three bases are generally accepted, the percentage of sales, the percentage of receivables, and the direct write-off.
• B) Management can choose whichever basis it prefers.
• C) If management wishes to emphasize the cash realizable value of receivables it will select the percentage of receivables basis.
• D) The company must determine its past experience with bad debt losses regardless of which basis it selects.

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Definitions:

High-context Culture

Cultures where communication relies heavily on implicit messages and contextual cues rather than explicit words.

Low-context Culture

Cultures where communication is explicit, messages are direct, and understanding does not heavily rely on contextual cues or shared background.

Example

A specific case or instance used to illustrate a concept, principle, or process.

Ethical Standards

Principles that guide behavior and actions based on what is morally right and wrong.