Which of the Following Statements Is Correct

question 59

Multiple Choice

Which of the following statements is correct?

• A)The journal entry to record bad debt expense requires a debit to bad debt expense and a credit to accounts receivable.
• B)The journal entry to record bad debt expense requires a debit to bad debt expense and a credit to allowance for doubtful accounts.
• C)The journal entry to record the write off of an uncollectible account receivable requires a debit to bad debt expense and a credit to accounts receivable.
• D)The journal entry to record the write off of an uncollectible account receivable requires a debit to bad debt expense and a credit to allowance for doubtful accounts.

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Definitions:

Pure Rent

Income earned from owning a resource completely fixed in supply, with no additional production cost.

Fixed Supply

A situation where the quantity of a good available is constant and does not change with price.

Demand Determined

A characteristic of markets where the quantity of goods or services sold is primarily influenced by consumer demand.

Perfectly Inelastic

A market situation where the quantity demanded or supplied is completely unresponsive to price changes.