Which of the Following Statements Is Not Correct

question 28

Multiple Choice

Which of the following statements is not correct?

• A) The use of the direct charge-off method of recording losses from uncollectible accounts usually results in the balance in the Accounts Receivable account being overstated.
• B) The direct charge-off method of recording losses from uncollectible accounts is the method required by Federal income tax laws.
• C) The direct charge-off method of recording losses from uncollectible accounts is an application of the matching principle.
• D) When using the direct charge-off method,there is no Allowance for Doubtful Accounts account.

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Definitions:

Meaningful Cautionary Statements

Communications that provide important warnings or advisements to prevent harm or misuse of a product or service.

Forward-Looking Forecasts

Predictive statements or projections about future events, typically concerning a company's revenues, earnings, or growth prospects.

Securities Fraud

Illegal practices involving the manipulation or misrepresentation of information related to investments, intended to deceive investors.

Misrepresenting Facts

The act of presenting false or misleading information intentionally or unintentionally, often to gain advantage or mislead others.