Q8.8: what is the effect of the collection of an account that had been previously written off under the allowance method of accounting? a : it will increase income in the period it is collected. b : it requires a correcting entry for the period in which the account was written off. c : it will decrease income in the period it is collected. d : it does not affect income in the period it is collected.

Capital financial corporation will lend 90 percent against account balances that have averaged 30 days or less; 80 percent for account balances between 31 and 40 days; and 70 percent for account balances between 41 and 45 days. customers that take over 45 days to pay their bills are not considered acceptable accounts for a loan. the current prime rate is 16.50 percent, and capital charges 3.50 percent over prime to charming as its annual loan rate. a. determine the maximum loan for which charming paper company could qualify.