Tom Jones, a Management Accountant, Was Faced with an Ethical

question 35

Multiple Choice

Tom Jones, a management accountant, was faced with an ethical conflict at the office. According to the Institute of Management Accountants' Statement of Professional Practice, the first action Tom should pursue is to:

• A)follow his organization's established policies on the resolution of such conflict.
• B)contact the local newspaper.
• C)contact the company's audit committee.
• D)consult an attorney.

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Definitions:

Allowance for Doubtful Accounts

This is a contra-asset account used to estimate the portion of accounts receivable that may not be collectible.

Accounts Receivable

Funds that customers owe a company for goods or services already provided but not yet compensated for.

Allowance Method

An accounting technique used to estimate and account for a firm's potentially uncollectible accounts receivable.

Allowance for Doubtful Accounts

An estimation of the amount of accounts receivable that may not be collectible.