At the Beginning of the Year, the Balance in Allowance

question 59

Multiple Choice

At the beginning of the year, the balance in Allowance for Doubtful Accounts is a credit of $760. During the year, $120 of previously written off accounts are reinstated and accounts totaling $740 are written off as uncollectible. The end-of-year balance (before adjustment) in Allowance for Doubtful Accounts should be

• A) $760
• B) $120
• C) $140
• D) $740

---

Definitions:

Socially Optimum

A condition or state in which resources are allocated in the most efficient manner from the perspective of the society overall, maximizing social welfare.

Public Park

An area of land, usually owned and maintained by government agencies, designated for public use and enjoyment, often featuring natural or landscaped spaces.

Pigouvian Subsidy

A subsidy on goods or services that have positive externalities, aimed at encouraging activities that are beneficial for society.

External Benefits

The positive effects or advantageous consequences of a product or service that are enjoyed by individuals or groups who did not directly purchase or consume the product or service.