If you a controller and the company always aim sustainable net income, but the company for this year had extremely high income due to increase of sales , so the president ask you to increase the yearly allowance for doubtful account from 4% to 6% of net credit sales because he is nervous the stockholders might expect the company to always be able to sustain such a high net income. Q/ as controller what actions should you take and whay ?

If you a controller and the company always aim sustainable net income, but the company for this year had extremely high income due to increase of sales , so the president ask you to increase the yearly allowance for doubtful account from 4% to 6% of net credit sales because he is nervous the stockholders might expect the company to always be able to sustain such a high net income. Q/ as controller what actions should you take and whay ?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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