The Balance in the Allowance for Doubtful Debts Account Represents

question 19

Multiple Choice

The balance in the Allowance for doubtful debts account represents:

• A) bad debts written off in the current accounting period.
• B) liquid funds available to meet losses arising from customers becoming insolvent.
• C) an amount that is deducted from the Accounts receivable account to reduce it to the estimated realisable value.
• D) bad debts written off as Accounts receivable considered uncollectable.

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Definitions:

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The degree to which a prediction matches the actual outcomes.

Criterion Variable

The dependent variable in a study or analysis that the independent variables aim to predict.

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A standardized test designed to measure an individual's potential to acquire certain skills or knowledge.

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Anticipated or forecasted level of achievement or output based on certain criteria or conditions.