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An decrease in the allowance for receivables results in:
A. An decrease in net profit
B. An increase in net current assets
C. A decrease in net current assets
D. An increase in current liabilitiesDear tutor, pls help me with this question. The answer given is A. Why it decrease the net profit? I thought it will increase the profit and also increase the net current assets.
Many thanks in advance:)
Are you sure that you have copied the question correctly?
If you have then the correct answer is indeed B and D !
Where did you find this question?
ya, i copied it correctly. It is from a text book i found online. Now i want to throw it away!
Thank you very much for your reply.
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