The Aging-Of-Receivables Method Is

question 101

Multiple Choice

The aging-of-receivables method is:

• A) not an acceptable method of estimating bad debts.
• B) a balance sheet approach, since it focuses on accounts receivable.
• C) an income statement approach, since it focuses on the amount of expense to be reported on the income statement.
• D) not concerned with the balance in the Allowance for Doubtful Accounts.

---

Definitions:

Gain

The increase in equity resulting from the sale of a business asset for more than its carrying amount.

Assets

Assets that a business possesses or controls, anticipated to yield future economic advantages.

Liabilities

Financial obligations or debts that a company owes to others, arising during the course of its operations.

Goods or Services

Products or activities provided by a business to customers in exchange for payment.