What would be the incremental bad debt losses if the change were made?
A) $130,000
B) $250,000
C) -$250,000 (bad debt losses would decline)
D) -$130,000 (bad debt losses would decline)

Question

Quizplus · Accepted Answer

The question suggests that by changing the credit policy, bad debt losses would decline. Therefore, the answer must be either option C or D. Option C suggests that bad debt losses would decline by $250,000, which seems very unlikely since the change in credit policy is not expected to have such a significant impact. Option D, on the other hand, suggests that bad debt losses would decline by $130,000, which is a more reasonable amount. Therefore, option D is the best choice.

What Would Be the Incremental Bad Debt Losses If the Change