A Company in Panama Pays a U

question 113

Multiple Choice

A company in Panama pays a U.S. architect to design a factory building. By itself this transaction

• A)increases Panama's imports and so decreases the Panama's trade balance.
• B)increases Panama's exports and so decreases the Panama's trade balance.
• C)decreases Panama's imports and so increases the Panama's trade balance.
• D)decreases Panama's exports and so increases the Panama's trade balance.

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Definitions:

Journalize

The process of recording transactions in the general journal using the double-entry bookkeeping system.

Allowance for Doubtful Accounts

A contra asset account used to estimate the portion of a company's accounts receivable that may not be collectible.

Uncollectible Receivables

Amounts owed to a company from customers that are considered unlikely to be collected.

Credit Balance

The amount appearing on the credit side of an account, indicating the total credits exceed the total debits.