If an item is considered to be low value, low risk, and has a large number of potential suppliers, it is typically classified in the leverage sourcing category.
<h3><u>What does a category of leverage sourcing mean?</u></h3>
The term "leverage sourcing category" is used in the procurement process to describe goods that have a variety of low-risk sources of supply. In most cases, it is assumed that using leverage will result in high expenditures and possible procurement savings.
<u>What roles do the various categories of leveraged sourcing play?</u>
- Grouping of the items to be purchased to aid in negotiations
- Reduce costs by making use of a market that is competitive.
- It aids in developing automatic supplier interfaces to cut down on process costs.
Learn more about the leverage sourcing category with the help of the given link:
brainly.com/question/4270172
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Answer and Explanation:
The Journal entries are shown below:-
1. Anthony Trucking Dr, $19,000
To Sales A/c $19,000
(Being the sales made is recorded)
2. Bank Dr, $5,000
To Anthony Trucking $5,000
(Being cash received is recorded)
3. Wrote off A/c Dr, $14,000
To Anthony Trucking $14,000
(Being Account receivable write off the balance is recorded)
4. Bank Dr, $14,000
To Wrote off $14,000
(Being cash received is recorded)
2. High Performance 's direct write-off approach would face drawbacks because it breaches the matching principle. The matching theory involves be matching the spending of uncollectible accounts with the relevant revenues. Here uncollectible amount is treated as a bad debt expense. The written off amount is treated as uncollectible amount by the customer
The answer will be CANOE. Hope this helps:)
