The Following Information Is from the 2016 Records of Armand

question 61

Multiple Choice

The following information is from the 2016 records of Armand Camera Shop: $\begin{array}{|l|l|}\hline \text { Accounts receivable, 31 December } 2016 &\$ 45,000 \text { (debit) } \\\hline\begin{array}{l}\text { Allowance for doubtful debts, 31 December } 2016\end{array} &\\\text { prior to adjustment } & 1900 \text { (debit) } \\\hline \text { Net credit sales for } 2016 & 178,000 \\\hline \text { Accounts written off as uncollectable during 2016 } & 19,000 \\\hline \text { Cash sales during } 2016 & 28,000\\\hline\end{array}$ Bad debts expense is estimated by the ageing of accounts receivable method.Management estimates that $8000 of accounts receivable will be uncollectable.Calculate the Allowance for doubtful debts after the adjustment for bad debt expense at 31 December 2016.

• A)$5340
• B)$8000
• C)$6000
• D)$11,800

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Definitions:

Strategic Investment

Investments made with a long-term perspective in mind, focusing on achieving broader business objectives rather than immediate financial gain.

Other Comprehensive Income

Other comprehensive income includes revenues, expenses, gains, and losses that are not included in net income and are reported in the equity section of the balance sheet.

Unrealized Gains

Increases in the value of an investment that have not been sold or exchanged for cash, thus not realized as income.

Management Evaluation

The process of assessing and reviewing the performance, skills, and effectiveness of managers within an organization.