Which Statement Is Correct About Recording an Allowance for Doubtful

question 85

Multiple Choice

Which statement is correct about recording an allowance for doubtful accounts?

• A)Accounts receivable are not adjusted for known uncollectable amounts.
• B)Net accounts receivable is recalculated when there are changes recorded in the Allowance for Doubtful Accounts contra account.
• C)Comparability is the reason an allowance for doubtful accounts is needed.
• D)An allowance for doubtful accounts does not require estimates or judgments.

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Definitions:

Preferences

Individual tendencies or choices toward certain options over others, often based on values, beliefs, or personal tastes.

Z Problem-Solving Model

A decision-making framework that alternates between analytical and intuitive thinking strategies.

Nonpreferences

Choices or options that are less desirable or not preferred by an individual or group when making decisions.

Individual Development

The continuous process of personality, skill, and capacity enhancement over one's lifespan.