Multiple Choice
A company is using the percentage-of-credit-sales method to estimate their bad debts and has noticed that over the past few years there has been a build-up of a debit balance in the Allowance for uncollectibles account.Which of the following is most likely the cause?
A) They have been consistently overestimating the bad debt expense.
B) They have been consistently underestimating the bad debt expense.
C) They have not written off enough accounts.
D) They have been selling more items on credit.
Correct Answer:
Verified
Correct Answer:
Verified
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