A Company Uses the Aging Method to Estimate Bad Debt

question 32

Multiple Choice

A company uses the aging method to estimate bad debt expense. Its tax rate is 30%. After issuing its 2009 financial statements, the firm discovered that it failed to write off $50,000 in receivables that were determined to be uncollectible in 2009. As a result of this error, net income was:

• A)Overstated by $35,000.
• B)Overstated by an undetermined amount.
• C)Understated by an undetermined amount.
• D)Unaffected.Receivables were overstated, so bad debt expense calculated as a percentage of receivables was also overstated.Therefore, net income was understated.The actual write-off would not have affected net income.

Analyze the psychosocial impacts of early or late pubertal development on adolescents.

Understand Erikson's psychosocial development stages, especially during adolescence.

Examine the changing nature of relationships in adolescence and the focus on identity formation.

Understand and define the key components of a promotional mix.

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Definitions:

Hats

A headwear item designed for various purposes including protection from weather, ceremonial reasons, religious reasons, safety, or fashion.

Production

The method of integrating different physical and non-physical inputs, such as materials and ideas, to produce goods for use.

Opportunity Costs

Missing out on potential benefits from various options due to the selection of a single alternative.

Trade

The practice, in a market economy, in which individuals provide goods and services to others and receive goods and services in return.