When an Account Is Sent to Collection, What Is Done

question 37

Multiple Choice

When an account is sent to collection, what is done to prevent further bills from being sent?

• A) A "hold" is placed on the account in the computer.
• B) The account is moved from the patient accounts to a special accounts file.
• C) The anticipated collection agency fee is subtracted from the account balance.
• D) The balance on the account is changed to zero using a debit (negative) adjustment.

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Definitions:

Raw Material

Fundamental substances utilized during the manufacturing process to create products.

Standard Cost System

An accounting system that uses cost estimates for material, labor, and overhead to assign costs to products and analyze variances.

Fixed Manufacturing Overhead Rate

A consistent charge per unit of production or period that allocates the total fixed manufacturing overhead costs.

Variances

The difference between expected and actual performance or costs in business operations.