Based on the Aging of Its Accounts Receivable at December

question 64

Multiple Choice

Based on the aging of its accounts receivable at December 31, Charman Company determined that the net realizable value of the receivables at that date is $304,000. Additional information is as follows: Charman's Bad Debt Expense for the year ended December 31 is

• A) $32,000
• B) $38,400
• C) $48,000
• D) $64,000

---

Definitions:

Good Faith Dispute

A disagreement where both parties have legitimate reasons for their position, implying neither is acting deceptively or maliciously.

Settlement Agreement

A legally binding contract between parties to a dispute, where they agree on the terms to resolve their differences without further litigation.

Legal Obligation

A duty enforced by law, requiring an individual or organization to follow or avoid a specific course of action.

Unilateral Contract

An agreement where only one party makes a promise or assumes an obligation to perform if a specified condition is met by another party.