Shupe IncEstimates Uncollectible Accounts Based on the Percentage of Accounts Receivable

question 165

Multiple Choice

Shupe Inc.estimates uncollectible accounts based on the percentage of accounts receivable.What effect will recording the estimate of uncollectible accounts have on the accounting equation?

• A)Increase liabilities and decrease stockholders' equity.
• B)Decrease assets and decrease liabilities.
• C)Decrease assets and decrease stockholders' equity.

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