A Method for Tracking Accounts Receivable That Matches Specific Invoices

question 34

Multiple Choice

A method for tracking accounts receivable that matches specific invoices and payments from the customer is called a(n) ________ method.

• A)specific identification
• B)balance forward
• C)cycle billing
• D)open-invoice

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Definitions:

FIFO

An inventory valuation method that assumes the first items placed in inventory are the first sold, standing for 'First In, First Out'.

GAAP

Generally Accepted Accounting Principles, a set of accounting standards and procedures used in the United States to govern financial reporting.

Current Cost

The cost that would be incurred to replace an asset or to purchase an equivalent asset at the current time.

Management Discretion

The degree of flexibility and judgement allowed to managers in making decisions and choices impacting the company's operations and performance.