Following Generally Accepted Accounting Principles,which Method of Estimating Uncollectible Accounts

question 69

Multiple Choice

Following Generally Accepted Accounting Principles,which method of estimating uncollectible accounts is NOT acceptable?

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

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Definitions:

Operating Cash Flow

Operating cash flow is the cash generated from the normal operations of a business, reflecting the company's ability to generate sufficient cash to maintain and expand operations.

Net Working Capital

The difference between a company's current assets and current liabilities, indicating its liquidity and operational efficiency.

Capital Spending

Funds used by a company to acquire or upgrade physical assets such as property, industrial buildings, or equipment to improve its capacity or efficiency.

Fixed Asset Purchases

Expenditures on long-term assets such as equipment, buildings, and machinery, which are used in the operation of a company.