1) What is an aging of accounts receivable, and how might an aging be useful in
estimating uncollectible accounts?
2) Custom Quilters makes decorative comforters, quilted garments, and other products
in a small sewing factory. In 2012, the company expects to make 2,000 comforters.
Indicate whether the given cost is direct or indirect with respect to the comforters, and
also whether it is fixed or variable with respect to the number of comforters. Indicate
your answers by placing X’s in the appropriate columns.
3) What is a “material misstatement”?
4) What type of account is the Allowance for Doubtful Accounts?
5) Explain why it is impossible to have a foolproof internal control system.