A Customer Pays on a Specific Account That the Company

question 2

Multiple Choice

A customer pays on a specific account that the company had previously written off as uncollectible. The journal entry to record the reinstatement under the allowance method includes a(n) :

• A) decrease to Cash.
• B) decrease to Sales.
• C) increase to Allowance for Doubtful Accounts.
• D) decrease to Bad Debts Expense.

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Definitions:

Money Supply

The full extent of financial assets at hand in an economy during a specific period.

Interest Rate

The percentage of a sum of money charged for its use, determining the cost of borrowing or the return on savings.

Money Supply

The total amount of money available in an economy at a specific time, including cash and deposits.

Opportunity Cost

Sacrificing the chance to gain from other alternatives by committing to one choice.