Which of the Following Is Considered a Use of Cash

question 12

Multiple Choice

Which of the following is considered a use of cash?

• A)Amortization
• B)Depreciation
• C)Decrease in net working capital
• D)Increase in net working capital

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Definitions:

Uncollectible

Refers to accounts receivable that a company has determined cannot be collected from customers.

Aging of Accounts Receivable Method

An accounting technique used to estimate the amount of uncollectable accounts receivable based on their age.

Allowance Method

An accounting technique used to estimate and account for doubtful debts, reflecting potential future losses on receivables.

Outstanding Accounts Receivable

Refers to the money owed to a company for goods or services that have been provided but not yet paid for.