Recently, Galaxy Corporation lowered its allowance for doubtful accounts by reducing bad debt expense from 2% of

Question:

Recently, Galaxy lowered its allowance for doubtful accounts by reducing bad debt expense from 2% of sales to 1% of sales. Ignoring taxes, what are the immediate effects on
(a), Operating income and
(b) Operating cash flow?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...