[Solved] What Is the Effect of Bad Debts on Revenue Recognition

Question 110
Multiple Choice

What is the effect of bad debts on revenue recognition?

A)The seller must believe it is probable it will collect the amounts it is entitled to collect.
B)Bad debts must be of a remote likelihood in order to recognize revenue.
C)Bad debts are deducted from revenue to calculate net revenue on the income statement,similar to sales returns.
D)Bad debts are ignored when determining whether to recognize revenue,but recognized as an expense on the income statement.

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