Deal of The Day! Hurry Up, Grab the Special Discount - Save 25% - Ends In 00:00:00 Coupon code: SAVE25
Welcome to Pass4Success

- Free Preparation Discussions
Mail Us support@pass4success.com
Location US
Mob_nav_barsMENU

CIMAPRA17-BA3-1 Exam - Topic 3 Question 129 Discussion

In the year ended 31 December 20X1, XYZ receives an email confirming that a major customer has gone into liquidation and will be unable to pay its suppliers.Which of the following is the impact of adjusting for this event?
D) Receivables decrease and profits decrease
A) Profits increase and allowance increases.
B) Receivables decrease and allowance increases
C) Receivables unchanged and profits decrease

CIMAPRA17-BA3-1 Exam - Topic 3 Question 129 Discussion

Actual exam question for CIMA's CIMAPRA17-BA3-1 exam
Question #: 129
Topic #: 3
[All CIMAPRA17-BA3-1 Questions]

In the year ended 31 December 20X1, XYZ receives an email confirming that a major customer has gone into liquidation and will be unable to pay its suppliers.

Which of the following is the impact of adjusting for this event?

Show Suggested Answer Hide Answer
Suggested Answer: D

by Anthony at Jul 01, 2026, 03:00 PM

Limited Time Offer

25%

Off

Get Premium CIMAPRA17-BA3-1 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

0/2000 characters
Submit Cancel
Dallas
I thought that if a customer goes into liquidation, we have to decrease both receivables and profits, but I can't recall the exact details.
upvoted 0 times
...
Gaston
5 days ago
I remember that when we increase the allowance for doubtful accounts, it usually means profits decrease. So maybe it's option D?
upvoted 0 times
...
Shawnda
10 days ago
I'm a bit unsure, but I feel like if the customer can't pay, we definitely need to adjust the receivables down.
upvoted 0 times
...
Dannie
15 days ago
I think this is similar to a practice question we did on bad debts, where we had to adjust receivables based on customer defaults.
upvoted 0 times
...

Save Cancel