Accounts Receivable Has a Balance of $30,000 and the Allowance

question 103

Multiple Choice

Accounts receivable has a balance of $30,000 and the Allowance for Bad Debts has a credit balance of $3,000. The allowance method is used. What is the net realizable value before and after a $2,000 Account Receivable is written off?

• A)$27,000; $27,000
• B)$14,300; $14,300
• C)$16,000; $15,940
• D)$16,000; $16,000

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Definitions:

Interest Rate

The percentage at which interest is charged or paid on a loan or investment over a specific period of time.

Equal Payments

Regular payments of the same amount, typically in the context of loan repayments or financial agreements.

Interest Rate

The proportion of a loan charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding.

No Interest

A financial condition where no additional money is charged beyond the principal amount borrowed or no profit is earned on an investment over time.