The Allowance for Uncollectible Accounts ________

question 121

Multiple Choice

The Allowance for uncollectible accounts ________.

• A)is subtracted from Sales to calculate Net sales on the income statement
• B)is always equal to Bad debts expense for the year
• C)is subtracted from Accounts receivable to calculate Net realizable value of accounts receivable
• D)is subtracted from Cash on the balance sheet

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Definitions:

Ledger

A comprehensive collection of all the accounts of a business, where transactions are recorded in a structured and detailed manner.

Income Statement

A financial statement that shows a company's revenue and expenses over a specific period, usually resulting in a net profit or loss.

Retained Earnings

The portion of net earnings not distributed to shareholders as dividends but retained by the company to be reinvested in its core business or to pay debt.

Accounts Payable

Money owed by a company to its creditors or suppliers for goods and services that have been received but not yet paid for.