The Way to Estimate Uncollectible Accounts by Analyzing Individual Accounts

question 94

Multiple Choice

The way to estimate uncollectible accounts by analyzing individual accounts receivable according to the length of time they have been outstanding is known as the:

• A)aging-of-receivables method.
• B)percent-of-sales method.
• C)allowance method.
• D)direct write-off method.

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Definitions:

Conflict of Interest

A situation where an individual's or entity's personal interests could potentially influence their professional decisions or actions.

Business Relationship

Refers to the connections and interactions between a company and its suppliers, customers, and partners which can influence the business's operations, sales, and overall success.

Creditors

Individuals or institutions that lend money or extend credit to others, with the expectation that the borrowed funds will be returned, often with interest.

Renegotiate

The process of revising the terms of an existing contract or agreement.