The Percentage-Of-Sales Procedure Arises from the Idea That Uncollectible Amounts

Multiple Choice

The percentage-of-sales procedure arises from the idea that uncollectible amounts will vary with the volume of credit business.The firm estimates the appropriate percentage by studying its own experience or by inquiring into the experience of similar firms.Default rates generally fall within the range of _____of credit sales.

A) .01% to .02%
B) 1% to 2%
C) 10% to 20%
D) 21% to 30%
E) 31% to 40%