Need Help Question: 71What are the advantages and disadvantages of thedirect write-off method?Question: 72How do you record a bad debt expense?

Question: 71Write-Off Method:When a business makes a sale on account, that may not translate to…

Answered: Question: 71 What are the advantages…

SWFT Individual Income Taxes

43rd Edition

ISBN:9780357391365

Author:YOUNG

Publisher:YOUNG

Chapter7: Deductions And Losses: Certain Business Expenses And Losses

Section: Chapter Questions

Problem 1DQ

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4)What’s the difference between doubtful debt and bad debt? 5) How do I create an allowance for doubtful accounts entry?
41.Which of the following shall be taken into consideration when measuring and recognizing impairment loss on receivables?A. Past experiences on the collectability of the receivablesB. Present condition of the debtor, including the present economic environmentC. Future expectations based on information that are available without undue cost and effort a. A, B and C b. A and B only c. A only d. B only
How is the allowance method of accounting for bad debts different from the direct write-off method? Which is the preferred method? Why?
What is the theoretical justification of the allowancemethod as contrasted with the direct write-off methodof accounting for bad debts?
Distressed Corporation is undergoing liquidation. Relevant information as of January 1, 20x1 is shown below: ASSETS Carrying Net Realizable Cash Accounts Receivable Equipment-net Land Amount P250,000 150,000 600,000 1,700,000 P2,700,000 Value P300,000 355,649 200,000 1,500,000 P2,355,649 TOTAL ASSETS LIABILITIES Carrying Amount P1,000,000 500,000 800,000 800,000 P3,100,000 Settlement Amount P1,000,000 Accounts Payable Salaries Payable Notes Payable Loan Payable TOTAL LIABILITIES 500,000 805,234 800,000 P3,105,234 EQUITY Share Capital Retained Earnings Capital Deficiency P1,600,000 (2,000,000) (400,000) TOTAL LIABILITIES & EQUITY P2,700,000 Additional Information: Administrative expenses amounting to P180,744 are expected to be incurred during the liquidation process. The equipment is pledged to the loan payable. The land is pledged to the notes payable.
3. Do you think garnishment at one's job is effective, in paying back the debt?
LO4 How is a transaction loss different from an annual loss?
What is proovision for bad debts
bad debt expense?
Bad debt is a deduction from the gross income when an account is written off Group of answer choices True False
How much is the net free assets? How much is the estimated deficiency to unsecured creditors? What is the estimated recovery percentage of unsecured non-priority creditors?
4. When do you considered a loan, receivables are impaired?

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Question: 71 What are the advantages and disadvantages of the direct write-off method? Question: 72 How do you record a bad debt expense?