The Carrying Amount of Accounts Receivable

question 1

Multiple Choice

The carrying amount of accounts receivable

• A)is the amount at which the receivables less the allowance for doubtful accounts are presented on the statement of financial position.
• B)reflects the sum of accounts receivable and the allowance for doubtful accounts.
• C)is the amount at which the receivables are presented on the statement of financial position.
• D)reflects management's estimate of the receivables that will ultimately not be collected after expected credit losses.

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Definitions:

Direct Materials

Direct Materials are raw materials that are directly traceable to the manufacturing of a product and are an integral part of the finished product.

Manufacturing Overhead

All indirect costs associated with the production of goods, such as utilities, maintenance, and supplies not directly traceable to a product.

Manufacturing Overhead

All costs related to the production process that are not direct materials or direct labor are considered indirect expenses.

Job-Order Costing

A cost accounting system that accumulates costs by specific jobs or orders, suitable for companies producing unique products or services.