Answer:
The correct answer is letter "B": The proceeds of the bond issue entirely as debt.
Explanation:
Under the U.S. General Accepted Accounting Principles (<em>GAAP</em>) the issuance costs of bonds are ignored for reporting purposes but the amount of sales revenues is recorded as debt. The amortization of the bond can be calculated using the <em>effective interest method</em> or the <em>straight-line method</em>.
The correct answer is D. All of these.
Answer:
$100,000
Explanation:
Based on the information given Jorgensen may lessen the amount of $100,000 in the second year which is year 2 reason been that the amount are NOT FIXED amount at the end of the year 1 because the employees are qualified to receive the bonus amount only in a situation where the employees are been employed on the date the bonuses amount were been paid.
Employees Deductible Year 1 Deductible Year 2
Ken $0 $40,000
Jayne $0 $30,000
Jill $0 $20,000
Justin $0 $10,000
Total $100,000
Answer:
Option D. management estimates the amount of uncollectibles
Explanation:
When the company estimates the bad debts, reflects it in the balance sheet through a Debit entry in the Bad Debt Expenses againts the asset account Allowance for Doubtful Accounts as a Credit.
When the bad debt are confirm as uncollectible the loss is reflected in the Account Receivable as a Credit with the correspondent debit entry in the Allowance for Doubtful Accounts.
