Most Accounting Policy Choices Affect Both the Income Statement and the Balance

question 30

Multiple Choice

Most accounting policy choices affect both the income statement and the balance sheet.Select the income statement account(s) that would be affected by a policy choice at the same time as the allowance for doubtful debts balance sheet account.

• A) revenue,bad debts expense
• B) cost of goods sold expense
• C) depreciation or amortisation expense
• D) various expense accounts.

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Definitions:

Present Value

The current assessment of a future cash sum or cash flow streams, discounted at a defined rate of return.

Coupon

The interest payment made to bondholders, typically expressed as an annual percentage of the bond's face value.

Coupon Bond

A type of bond that offers periodic interest payments to the holder through fixed "coupons" and the return of the principal at maturity.

Yield To Maturity

The total return expected on a bond if held until its maturity date, including both interest payments and capital gains.