How much is the net effect of classifying NCAHS and reclassifying back to PPE on 2019 net income? (indicate negative sign if decrease)
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
![On January 1, 2019, ABC Company classified PPE as held for sale that had a carrying amount of P
2,600,000. On this date, the assets are expected to be sold for P 2,400,000. Reasonable disposal cost
to be incurre upon sale was expected at P 100,000.
As of December 31. 2019. the asset had not been sold. After considering its options, management
decided to put back the noncurrent asset for use in operations. On that date, ABC's financial managers
estimated the noncurrent asset was now expected to be selling at P 2,500,000 with disposal cost of P
50,000 while depreciation for 2019 was computed at P 400,00 if the noncurrent asset was not
classified as held for sale.
How much is the net effect of classifying NCAHS and reclassifying back to PPE on 2019 net income?
(indicate negative sign if decrease)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F7080cd21-6459-476e-97b4-549e3baf1417%2F6cc16707-c94a-4291-815c-e6a504962cb7%2Fe001ggf_processed.png&w=3840&q=75)
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