Which of the Following Is least Likely to Help a Company

question 79

Multiple Choice

Which of the following is least likely to help a company minimize losses as credit standards are relaxed?

• A)Require potential customers to provide bank guarantees.
• B)Ask a potential customer for references regarding payment history.
• C)Increase the estimate of uncollectible accounts at the end of each period.
• D)Check a potential customer's credit rating.

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Definitions:

Job Order Cost System

An accounting system that accumulates costs by individual jobs or batches and is used when products or services are distinctly custom.

Raw Materials Inventory

The total amount of raw materials on hand that are waiting to be used in the production process.

Work in Process

Work in Process (WIP) refers to partially finished goods that are still in the production process at any given time.

Predetermined Overhead Rate

A rate used to allocate manufacturing overhead to individual units of production, based on estimated costs and activity levels.