Once a CPA Has Determined That Accounts Receivable Has Increased

question 78

Multiple Choice

Once a CPA has determined that accounts receivable has increased because of slow collection in a "tight money" environment, the CPA would be likely to:

• A)increase the balance in the allowance for bad debts account.
• B)review the going concern ramifications.
• C)require the entity to tighten its credit policy.
• D)expand tests regarding the collectability of receivables.

---

Definitions:

Rude

Describing behavior or speech that is impolite, disrespectful, or discourteous to others.

Paycuts

Reductions in an employee's salary or wages, often implemented as a cost-saving measure or in response to economic downturns.

Emotional Effect

The impact on individuals' feelings or emotional states resulting from specific stimuli or situations.

Anxiety

A mental health condition characterized by feelings of worry, anxiety, or fear that are strong enough to interfere with one's daily activities.