1. Under IFRS, accounts receivable can be accounted for at fair value whenever company management wants to do so. True False 2. At January 1, 2011, Farley Co. had a credit balance of $520,000 in its allowance for uncollectible accounts. Based on past experience, 2 percent of Farley's credit sales have been uncollectible. During 2011, Farley wrote off $650,000 of accounts receivable. Credit sales for 2011 were $18,000,000. In its December 31, 2011 balance sheet, what amount should Farley report as allowance for uncollectible accounts? $230,000. $360,000. $590,000. $880,000. 3. Brewer Inc. is owed $200,000 by Carol Co. under a 10% note with two years remaining to maturity. Due to financial difficulties Carol Co. did not pay the prior year's interest. Brewer agrees to settle the receivable (and accrued interest) in exchange for a cash payment of $150,000. The journal entry that Brewer would make to record this transaction would include a loss on troubled debt restructuring of: $0. $20,000. $50,000. $70,000.
Paper#12975 | Written in 18-Jul-2015Price : $25