At Year-End MarisAlbion Sent Out Accounts Receivable Confirmations

question 9

Multiple Choice

At year-end MarisAlbion sent out accounts receivable confirmations. One of the major customers of her client confirmed that they would not be able to pay off the receivable. The client subsequently went bankrupt and an aggrieved shareholder of Marissa's client sued her firm. What type of subsequent event was this?

• A) Type 1
• B) Type 2
• C) Type 1 and 2
• D) this was not a subsequent event

Calculate and report expenses related to prepaid assets like insurance and supplies.

Differentiate between assets that are depreciated and those that are not.

Compute depreciation expense using the straight-line method.

Record and reverse accrued expenses and understand their impact on financial statements.

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Definitions:

Full Capacity

The maximum level of output that a company can sustain over a long period without increasing its resources.

Sales Level

The total volume or value of all products or services sold by a company within a specific period.

Fixed Assets

Long-term tangible assets used in the operation of a business that are not expected to be converted to cash within a year.

Full Capacity

The maximum level of output that a company can sustain within a specific period under normal operating conditions.