The Single Most Important Indicator Used to Identify Impaired Accounts

question 189

Multiple Choice

The single most important indicator used to identify impaired accounts receivable (potential bad debts) is

• A)the dollar amount of the receivable.
• B)current economic conditions.
• C)geographic location.
• D)the age of the account.

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Definitions:

Real Capital

Physical assets that are used in the production of goods and services, such as machinery, buildings, and equipment.

Vicious Circle

A complex sequence of negative events or conditions that reinforce each other, leading to a deteriorating situation or a series of worsening cycles.

Infrastructure Problem

Issues or challenges related to the basic facilities, services, and installations needed for the functioning of a community or society, like roads, bridges, and power supplies.

Capital Flight

The rapid movement of large sums of money or capital out of a country due to economic or political instability, affecting the country's financial health.