An increase in the allowance for doubtful accounts would NOT be caused by which of the following?

Question

Quizplus · Accepted Answer

An increase in cash sales would not be a reason to increase the allowance for doubtful accounts, as cash sales would not be subject to credit risk or the possibility of non-payment. The other options, such as a declining economic climate, credit problems with customers, and an increase in accounts receivable, could all lead to an increase in the allowance for doubtful accounts as there may be a higher likelihood of customers not being able to pay their debts.

An Increase in the Allowance for Doubtful Accounts Would NOT