Which of the Following Events Is Not a Business Transaction

question 143

Multiple Choice

Which of the following events is not a business transaction?

• A) Issuance of shares in exchange for cash
• B) Hired employees
• C) Incurred utility expenses for the month
• D) Earned revenue for services provided

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Definitions:

Bad Debt Expense

The expense recognized when a business determines that an amount owed by a debtor is unlikely to be collected.

Specific Customer's Account

An account representing the transactions and outstanding balance related to a particular customer.

Bad Debt Expense

The estimated amount of receivables that a company does not expect to collect, recognized as an expense in financial statements.

Direct Write-off Method

An accounting approach where uncollectable debts are only written off when they are confirmed to be uncollectible, impacting the profit and loss account.