Specialization in Production Is Important Primarily Because It

question 19

Multiple Choice

Specialization in production is important primarily because it:

• A)results in greater total output
• B)allows society to avoid the problem of shortages
• C)allows society to trade by barter
• D)allows society to have fewer capital goods
• E)allows society to avoid the problem of surpluses

---

Definitions:

Allowance for Doubtful Accounts

A contra-asset account used to estimate the portion of a company's accounts receivable that may not be collectible.

Sales Returns

Transactions where customers return previously purchased merchandise, leading to a reduction in sales revenue.

Allowance for Doubtful Accounts

An accounting provision representing the estimated amount of receivables that may not be collected, reducing the accounts receivable balance to its net realizable value.

Net Realizable Value

The estimated selling price of goods, minus the costs of their sale or disposal, used in valuing inventory and accounts receivable for financial reporting.