Which One of the Following Is Not an Accurate Description

question 44

Multiple Choice

Which one of the following is not an accurate description of the Allowance for Doubtful Accounts?

• A)The account is a contra account.
• B)The account is a temporary account.
• C)The amount of the Allowance for Doubtful Accounts decreases the net realizable value of a company's receivables.
• D)The account is increased by an estimate of uncollectible accounts expense.

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Definitions:

Trading Costs

Expenses incurred in the process of buying or selling securities, including commissions, spreads, and slippage.

Marketable Securities

Financial instruments that can be quickly converted into cash at market value, such as stocks, bonds, and Treasury bills.

Daily Interest Rate

The interest rate applied to a loan or investment for a single day, often used for calculating interest over short periods.