Which of the Following Is/are Not a Shortcoming of the Direct

question 13

Multiple Choice

Which of the following is/are not a shortcoming of the direct write-off method?

• A)It provides firms with an opportunity to manage earnings each period by deciding when particular customers' accounts become uncollectible.
• B)It does not usually recognize the loss from uncollectible accounts in the period in which the sale occurs and the firm recognizes revenue.
• C)The amount of accounts receivable on the balance sheet does not reflect the amount a firm expects to collect in cash.
• D)It is the method required for income tax reporting in the United States.
• E)none of the above.

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Definitions:

Product Availability

Refers to the extent to which goods or services can be bought from a company at any given time.

Cost of Stocking Out

The financial loss and potential customer dissatisfaction resulting from insufficient inventory to meet demand.

Cutaneous Membrane

The skin, the largest organ of the body, serving as a protective barrier against environmental hazards and pathogens, and involved in sensation and temperature regulation.

Papillary Layer

The uppermost layer of the dermis, directly underneath the epidermis, containing small, finger-like projections called papillae.