Bert Had Accounts Receivable of $280,000 and an Allowance for Doubtful

question 39

Multiple Choice

Bert had accounts receivable of $280,000 and an allowance for doubtful accounts of $10,800 just before writing off as worthless an account receivable from Ernie Company of $1,600.After writing off this receivable what would be the balance in Bert's Allowance for Doubtful Accounts?

• A)$10,800 credit balance.
• B)$12,400 credit balance.
• C)$9,200 credit balance.
• D)$9,200 debit balance.

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Definitions:

Profitability

The measure of a business's ability to generate earnings compared to its expenses and costs, determining its financial success and viability.

Production Cost

The total expense incurred in the manufacturing of a product, including raw materials, labor, and overhead costs.

Postponement

A supply chain strategy that delays the final assembly or customization of a product until the latest possible time to reduce inventory costs and improve customization.

Level of Availability

The extent to which a product or service can be provided to customers when and where it is required.