Which of the Following Transactions Will Result in a Decrease

question 28

Multiple Choice

Which of the following transactions will result in a decrease in the receivable turnover ratio?

• A)The journal entry to record bad debt expense.
• B)Writing off an uncollectible account receivable.
• C)Selling inventory on account.
• D)Collecting an account receivable.

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Definitions:

Variable Costs

Charges that adjust in accordance with the level of output or service delivered by an enterprise.

Financial Break-Even

The point at which total revenues and total costs are equal, meaning a project or business is neither making a profit nor a loss.

Sensitivity Analysis

An approach to assess how different values of an independent variable affect a particular dependent variable under a given set of assumptions.

Financial Break-Even

The point where total revenues equal total costs, leading to neither a profit nor a loss.