The journal entry when writing off an account as uncollectible under the allowance method is:
Allowance for Doubtful Debts ( Dr.) xxxxx
Accounts Receivable ( Cr.) xxxxx
The allowance technique involves putting aside a reserve for terrible debts that are expected in the future. The reserve is based on a percent of the income generated in a reporting length, possibly adjusted for the danger associated with positive clients.
The allowance technique is used to determine how an awful lot of money a commercial enterprise needs to set apart for future awful or unrecoverable customer debt. It factors in the price of the losses an organization expects from extending patron credit.
The allowance approach requires a small commercial enterprise to estimate at the cease of the 12 months how an awful lot awful debt they have got, while the direct write-off method we could owners write off horrific debt whenever they determine a patron might not pay an invoice.
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Answer:
The opportunity cost will be Buying a new lawnmower
Explanation:
Opportunity cost refers to the cost of a forgone alternative. In this scenario, since the owner of a landscaping business has decided to spend the extra income on advertising campaign in order to increase sales, the forgone alternative here becomes buying a new lawnmower.
Expansionary fiscal policy to prevent real GDP from falling below potential real GDP would cause the inflation rate to be _<u>higher</u><u>_</u>and real GDP to be <u>higher.</u>
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What is Expansionary fiscal policy ?</h3>
Expansionary fiscal policy can be defined as the type of fiscal policy in which government intend to increase the aggregate money supply while on the other hand cut or reduce the tax rate for the purpose of economy growth.
In a situation were real GDP fall below potential real GDP this tend to lead to increase in both inflation rate and real GDP.
Inconclusion the inflation rate will be _<u>higher</u><u>_</u>and real GDP will be <u>higher.</u>
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Explanation:
Breakeven=fixed cost/selling price - variable cost
so 14,300000/380-250
14,300000/130 = 110,000 units to be able to make break even