Using the Percentage of Receivables Method for Recording Bad Debts $\neq 150,000$

question 96

Multiple Choice

Using the percentage of receivables method for recording bad debts expense, estimated uncollectible accounts are $\neq 150,000$ . If the balance of the Allowance for Doubtful Accounts is $\neq 30,000$ debit before adjustment, what is the balance after adjustment?

• A) \(\quad ¥ 150,000\)
• B) \(\quad ¥ 180,000\)
• C) \(\quad ¥ 120,000\)
• D) \(\quad ¥ 30,000\)

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Definitions:

Accounts Receivable

Money owed to a company by its customers for products or services that have been delivered but not yet paid for.

Accounts Payable

Liabilities owed by a business to its creditors for goods and services received, but not yet paid for.

Notes Payable

A financial accounting term that represents a written promise to pay a certain amount of money, typically with interest, on or before a specified date.

Profitability Ratios

Measures of a company’s overall financial performance by evaluating its ability to generate revenues in excess of expenses.