Proper Accounting Requires That an Account Receivable Must Be Written

question 95

Multiple Choice

Proper accounting requires that an account receivable must be written off by the client when

• A)the client company concludes that an amount is no longer collectible.
• B)the customer files for bankruptcy.
• C)a collection agency cannot inspire the customer to pay the debt.
• D)the account is at least six months old.

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Definitions:

Variable Resources

Inputs or factors of production that can be adjusted in the short term to meet changes in the level of output, such as labor and raw materials.

MRPs

Marginal revenue products, a measure of the additional revenue generated by employing an additional unit of a resource or factor of production.

Labor Cost

The total expenditure incurred by employers for the wages, benefits, and taxes associated with their workforce.

Total Cost Ratio

A financial metric that sums all the costs associated with the production and delivery of goods or services to the market, divided by the total quantity produced, to assess efficiency.