The Allowance for Doubtful Debts Account Has a Balance at the Start

question 29

Multiple Choice

The allowance for doubtful debts account has a balance at the start of the year of $2000. At the end of the year debts of $880, including $80 GST, are to be written off and the allowance for doubtful debts is to be adjusted to 10% of the closing accounts receivable balance of $33 000 (including $3000 GST) . The amount for bad and doubtful debts appearing in the income statement for the year will be:

• A) $3000.
• B) $1800.
• C) $1200.
• D) $3300.

Analyze additional business considerations based on variable and fixed costs.

Understand relevant and irrelevant costs for decision making.

Identify the steps involved in managerial decision-making.

Understand the concept of opportunity cost in decision making.

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Definitions:

Comprehensiveness

The quality of being thorough and complete, covering all or nearly all elements or aspects.

Complexity

The state or quality of being intricate or complicated, often referring to systems with multiple and diverse components that interact in varied ways.

Low Level Of Helper Directiveness

A low level of helper directiveness involves a non-directive approach by counselors or therapists, encouraging clients to explore thoughts and feelings independently.

Structured Homework Assignments

Specific tasks or exercises prescribed by a therapist to clients to complete outside of therapy sessions to reinforce therapeutic gains.