O. Which of the following statements about extending credit is not A) It is common for compani es to sell on account to other companies B) Some companies C) Bad debts arise from credit sales to indi companies. extend credit to arise from credit sales to individual consumers, but not from credit sales to odhser D) When credit is available, customers often buy more products and services 11. Countryside Corporation is owed $11,890 from a customer for landscaping. The account is overdue and the customer is having difficulty paying. Countryside might ask the customer to sign a note for the unpaid amount to: A) decrease its net income for tax reporting purposes. 5) strengthen Countryside Corporation's legal right to be repaid with interest. C) reduce its tax liability D) eliminate any doubts of collection of the amount due. 12. Notes Receivable differ from Accounts Receivable in that Notes Receivable: A) generally, charge interest from the day they are signed to the day they are collected B) are noncurrent assets C) do not have to be created for every new transaction, so they are used more frequently D) are generally considered a weaker legal claim 13. Why are estimates of bad debts used to record uncollectible amounts of accounts receivable? B) It is an easier method than waiting for accounts to actually become uncollectible. C) Because the actual amount of uncollectible accounts can never be known. D) It is the most conservative approach. A) Doing so avoids violating the expense recognition ("matching") principle. 14. The adjusting entry to record the estimated bad debts in the period credit sales occur would normally include a debit to: A) Accounts Receivable and a credit to Allowance for Doubtful Accounts B) Bad Debt Expense and a credit to Allowance for Doubtful Accounts. Allowance for Doubtful Accounts and a credit to Accounts Receivable. ) Bad Debt Expense and a credit to Accounts Receivable