In Reviewing the Accounts Receivable, the Cash Receivable Value Is

question 141

Multiple Choice

In reviewing the accounts receivable, the cash receivable value is $28,000 before the write-off of a $2,000 account.What is the cash receivable value after the write-off?

• A)$28,000
• B)$2,000
• C)$30,000
• D)$26,000

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Definitions:

Cost Allocation

The process of identifying, aggregating, and assigning costs to cost objects, such as departments, products, or projects, for budgeting, accounting, or costing purposes.

Reciprocal Services

The process in cost accounting where two or more departments provide services to each other and the costs of these services are allocated between them.

Direct Method

A costing approach that allocates service department costs directly to producing departments without considering service department interactions.

Support Department

A division within an organization that provides essential services to other departments but does not directly contribute to profit, such as IT or HR.