Which of the Following Statements Is True Regarding the Two

question 124

Multiple Choice

Which of the following statements is true regarding the two allowance methods used to account for bad debts?

• A)The percentage of net credit sales approach takes into account the existing balance in the Allowance for Doubtful Accounts account.
• B)The direct write-off method takes into account the existing balance in the Allowance for Doubtful Accounts account.
• C)The percentage of accounts receivable approach takes into account the existing balance in the Allowance for Doubtful Accounts account.
• D)The direct write-off method does a better job of matching revenues and expenses.

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Definitions:

Ethical Rule

A guideline or standard that directs moral conduct within a specific profession, especially in law or medicine.

Situations

Circumstances or sets of conditions existing at a certain time and place.

Model Rules

A set of ethical guidelines adopted by some legal associations as a framework for professional conduct.

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A legal or ethical principle that requires individuals or entities to keep certain information secret and not disclose it to unauthorized parties.