When Using the Allowance Method,after a Company Has Previously Written

question 191

Multiple Choice

When using the allowance method,after a company has previously written off an account,________.

• A) the company continues to send monthly statements to the customers whose accounts have been written off
• B) the company cannot collect from these customers because their accounts have been written off
• C) when a customer pays on an account that has been written off, the company needs to reverse the write-off to the Allowance for Bad Debts account and then record the receipt of cash
• D) the company does not need to reestablish the receivable account

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Definitions:

Labor Contract

The formal, written document that spells out the relationship between the union and management for a specified period of time—usually two or three years.

Management

A process designed to achieve an organization's objectives by using its resources effectively and efficiently in a changing environment.