Lance's Boss Offers Him Twice His Usual Wage Rate to Work

question 97

Multiple Choice

Lance's boss offers him twice his usual wage rate to work tonight instead of taking his girlfriend on a romantic date. This offer will likely:

• A)​not affect the opportunity cost of going on the date.
• B)​reduce the opportunity cost of going on the date because giving up the additional work dollars will make his girlfriend feel even more appreciated.
• C)​increase the opportunity cost of going on the date.
• D)​reduce the opportunity cost of working.

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Definitions:

Allowance Method

An accounting technique that estimates and deducts accounts receivable that may not be collectible, to more accurately represent a company's financial position.

Net Realizable Value

The estimated selling price of goods minus the cost of their sale or disposal, used in valuing inventory to reflect the net amount that can be realized.

Allowance for Doubtful Accounts

An estimation of future uncollectible amounts from customers, reducing the accounts receivable balance to a more realistic figure.

Previously Written Off

This term refers to debts or assets that had been removed from an organization's financial statements as losses but may later be recovered or re-evaluated.