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horrorfan [7]
3 years ago
5

Margaret is the manager of a medium-size company. A few years ago, Margaret persuaded the owner to base a part of her compensati

on on the net income of the company. Each December she estimates year-end financial figures in anticipation of the bonus she will receive. If the bonus is not as high as she would like, she offers several recommendations to the accountant for year-end adjustments. One of her favorite recommendations is for the controller to reduce the estimate of doubtful accounts. 1. What effect does lowering the estimate for doubtful accounts have on the income statement and balance sheet
Business
1 answer:
8090 [49]3 years ago
6 0

Answer:

  • Overstates the Net Income in Income statement
  • Overstates Accounts Receivable in Balance Sheet

Explanation:

The estimate for doubtful debt serves a very important role in accounting because it ensures that a company is ready for the possibility of bad debt occurring. Without it, a company would have to deal with bad debts as they come and this can damage profit projections.

It is treated as an expense in the business so in reducing it, Margaret is reducing the expenses which will increase the net income. This net income will be overstated however because the estimate for doubtful accounts should be higher than it is.

Estimates for doubtful debt are deducted from the Accounts Receivable balance in the Balance sheet so if it is reduced, the Accounts Receivable balance will not be reduced as much as it should be which would mean that is is overstated or higher than it should be.

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4 years ago
Joslyn Company manufactures metal brackets. The estimated number of metal bracket sales for the first three months of the curren
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Answer:

Production= 1,240 units

Explanation:

Giving the following information:

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3 years ago
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________ is a set of activities and techniques firms employ to efficiently and effectively manage the flow of merchandise from t
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<u>Supply Chain Management</u><u>  is a set of activities and techniques firms employ to efficiently and effectively manage the</u><u> flow of merchandise</u><u> from the vendors to the retailer's customers.</u>

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Supply Chain Management What Is It?

The management of a product's creation and flow, from sourcing raw materials to production, logistics, and delivery to the final consumer, is known as supply chain management (SCM).

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The four components of the supply chain—integration, operations, purchasing, and distribution—work together to create a route to competition that is efficient.

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2 years ago
TRUE/FALSE if a student leaves a book bag in class by accident and the professor takes possession to safeguard the bag, a bailme
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if a student leaves a book bag in class by accident and the professor takes possession to safeguard the bag, a bailment has been formed-True

<h3>bailment</h3>

A bailment is a form of the legal relationship that focuses on the contractual transfer of assets or property from a bailor to a baile who voluntarily but temporarily gives up possession but not complete ownership. Even though no contract is formalized, a bailment is a type of contractual relationship. The person receiving the property (the "bailee") has custody and control over it for a certain amount of time, during which he or she is responsible for taking reasonable care of it.

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