Which of the Following Best Describes the Application of Generally

question 108

Multiple Choice

Which of the following best describes the application of generally accepted accounting principles to the valuation of accounts receivable?

• A) Realization principle-Accounts receivable are shown at their net realizable value in the balance sheet.
• B) Matching principle-The loss due to an uncollectible account is recognized in the period in which the sale is made, not in the period in which the account receivable is determined to be worthless.
• C) Cost principle-Accounts receivable are shown at the initial cost of the merchandise to customers, less the cost the seller must pay to cover uncollectible accounts.
• D) Principle of conservatism-Accountants favor using the lowest reason?able estimate for the amount of uncollectible accounts shown in the balance sheet.

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Definitions:

Elderly

Refers to individuals, typically aged 65 and older, often considered in the context of healthcare, social support, and society’s dynamics.

Societies

Groups of individuals living together in organized communities with shared laws, traditions, and values.

Governments

The organizations or systems that govern a community, region, or country, responsible for creating and enforcing laws and policies.

Primary Caregiver

The main person responsible for providing care and support to a dependent individual, often a child or elderly person.