Consider the following worksheet with information extracted from a financial statement: 2020 Assets Liabilities Equity Reported (P) 400 000 100 000 300 000 You identify that a firm has incorrectly recognized revenue on P50 000 worth of goods in the form of receivables. You decide to reverse this sale and the associated inventory which has a value of P40 000. Using the worksheet approach and assuming a corporate tax rate of 30 percent, what would be the adjusted debt to assets ratio?

Consider the following worksheet with information extracted from a financial statement: 2020 Assets Liabilities Equity Reported (P) 400 000 100 000 300 000 You identify that a firm has incorrectly recognized revenue on P50 000 worth of goods in the form of receivables. You decide to reverse this sale and the associated inventory which has a value of P40 000. Using the worksheet approach and assuming a corporate tax rate of 30 percent, what would be the adjusted debt to assets ratio?

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 9PA: Noren Company uses the balance sheet aging method to account for uncollectible debt on receivables....

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