Ralph newsome is an employee at quest industries. in the men's room he overhears two officers discussing a merger that they say will be announced in two days. ralph purchases 1,000 shares of quest. when the merger is announced, quest's stock has a 15% bounce in value.

a. ralph has engaged in insider trading.

b. ralph simply overheard a conversation and can trade on that information.

c. ralph is not an officer and can trade in advance of announcements.

d. none of the above

Exercise 7-7 martinez company reports the following financial information before adjustments. dr. cr. accounts receivable $168,900 allowance for doubtful accounts $3,200 sales revenue (all on credit) 849,300 sales returns and allowances 50,440 prepare the journal entry to record bad debt expense assuming martinez company estimates bad debts at (a) 4% of accounts receivable and (b) 4% of accounts receivable but allowance for doubtful accounts had a $1,550 debit balance. (if no entry is required, select "no entry" for the account titles and enter 0 for the amounts. credit account titles are automatically indented when the amount is entered. do not indent manually.)