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Unformatted text preview: t can do for you. © Agilent Technologies, Inc. 2012 u.s. 1-800-829-4444 canada: 1-877-894-4414 Download free ebooks at 5 Contents Current Assets: Part II 39 39 40 Inventory Estimation Techniques Gross Profit Method Retail Method 41 41 41 10. Inventory Management 43 11. Inventory Errors 44 You’re full of energy and ideas. And that’s just what we are looking for. © UBS 2010. All rights reserved. Lower of Cost or Market Adjustments Measuring Market Value Application of the Lower-of-Cost-or-Market Rule 9. 9.1 9.2 Please click the advert 8. 8.1 8.2 Looking for a career where your ideas could really make a difference? UBS’s Graduate Programme and internships are a chance for you to experience for yourself what it’s like to be part of a global team that rewards your input and believes in succeeding together. Wherever you are in your academic career, make your future a part of ours by visiting Download free ebooks at 6 Accounts Receivable Current Assets: Part II Part 1 Accounts Receivable Your goals for this “Accounts Receivable” chapter are to learn about: The costs and benefits of selling on credit. Accounting considerations for uncollectible receivables. Alternative approaches to account for uncollectibles. Notes receivable and interest, including dishonored obligations. Download free ebooks at 7 The Costs and Benefits of Selling on Credit Current Assets: Part II 1. The Costs and Benefits of Selling on Credit You already know that receivables arise from a variety of claims against customers and others, and are generally classified as current or noncurrent based on expectations about the amount of time it will take to collect them. The majority of receivables are classified as trade receivables, which arise from the sale of products or services to customers. Such trade receivables are carried in the Accounts Receivable account. Nontrade receivables arise from other transactions and events, including advances to employees and utility company deposits. 1.1 Credit Sales To one degree or another, many business transactions result in the extension of credit. Purchases of inventory and supplies will often be made on account. Likewise, sales to customers may directly (by the vendor offering credit) or indirectly (through a bank or credit card company) entail the extension of credit. While the availability of credit facilitates many business transactions, it is also costly. Credit providers must conduct investigations of credit worthiness, and monitor collection activities. In addition, the creditor must forego alternative uses of money while credit is extended. Occasionally, a creditor will get burned when the borrower refuses or is unable to pay. Depending on the nature of the credit relationship, some credit costs may be offset by interest charges. And, merchants frequently note that the availability of credit entices customers to make a purchase decision. 1.2 Credit Cards Banks...
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This note was uploaded on 06/07/2013 for the course BA 201 taught by Professor Cuongvu during the Fall '13 term at RMIT Vietnam.

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