Which of the Following Is an Example of a Detect

question 27

Multiple Choice

Which of the following is an example of a detect control?

• A)Amounts are not able to be paid to employees without first matching a valid tax file number to the employee master file.
• B)Account coding on purchase orders being checked by the computer to a table of valid account numbers.
• C)Quarterly reviews of credit balances in accounts receivable to determine their causes.
• D)None of the above.

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Definitions:

Allowance for Doubtful Accounts

A contra-asset account used to estimate the portion of a company's accounts receivable that may not be collectable.

Bad Debt Expense

The portion of receivables that a company estimates it will not collect, considered as an expense in the income statement.

Estimated Uncollectible Accounts

An accounting provision for debts that are anticipated to be uncollectable from customers or clients.

Direct Write-off Method

An accounting approach where uncollectable accounts receivable are directly written off against income at the time they are deemed to be uncollectible.