PIPO P SP saf NOREN COMPANY Comparative Income Statments Year Ended December 31, 2019 Original Categories Categories Change Net Credit Sales $1,270,000 $1,270,000 Cost of Goods Sold 60,000 60,000 Gross Margin $1,210,000 $1,210,000 Expenses: General and Administrative Expense $300,500 $300,500 Bad Debt Expense Total Expenses Net Income (Loss) D. How does the new total uncollectible amount affect net income and net accounts receivable? a. Bad debt expense is lower, net income is higher, and net receivables are higher. b. Bad debt expense is lower, net income is higher, and net receivables are lower. c. Bad debt expense is higher, net income is lower, and net receivables are higher. d. Bad debt expense is higher, net income is lower, and net receivables are lower.
PIPO P SP saf NOREN COMPANY Comparative Income Statments Year Ended December 31, 2019 Original Categories Categories Change Net Credit Sales $1,270,000 $1,270,000 Cost of Goods Sold 60,000 60,000 Gross Margin $1,210,000 $1,210,000 Expenses: General and Administrative Expense $300,500 $300,500 Bad Debt Expense Total Expenses Net Income (Loss) D. How does the new total uncollectible amount affect net income and net accounts receivable? a. Bad debt expense is lower, net income is higher, and net receivables are higher. b. Bad debt expense is lower, net income is higher, and net receivables are lower. c. Bad debt expense is higher, net income is lower, and net receivables are higher. d. Bad debt expense is higher, net income is lower, and net receivables are lower.
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter12: Fainancial Statement Analysis
Section: Chapter Questions
Problem 74E
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