Gowns, Inc

question 125

Multiple Choice

Gowns, Inc.uses the percentage of receivables basis to estimate its bad debts.At December 31, 2011, Gowns estimates total bad debts that will become uncollectible in the future as €4,456.The existing balance in the Allowance for Doubtful Accounts is a credit balance of €1,056.The Accounts Receivable balance at December 31, 2011 is €79,200.The amount of the bad debt adjusting entry at December 31, 2011 will impact the statement of financial position accounts by

• A)Increase expenses by €4,456.
• B)Increasing the Allowance for Doubtful Accounts by €4,456.
• C)Increasing Accounts Receivable by €3,400.
• D)Increasing the Allowance for Doubtful Accounts by €3,400.

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Definitions:

Genetically Identical Offspring

Offspring that share the same genetic material, typically as a result of asexual reproduction.

Genetic Recombination

The process by which pieces of DNA are broken and recombined to produce new combinations of alleles, contributing to genetic diversity.

Muller's Ratchet

A process by which the genomes of an asexual population accumulate deleterious mutations in an irreversible manner.

Deleterious Mutations

Genetic alterations that are harmful to an organism, potentially reducing its fitness and survivability.