Business Administration 2257 Study Guide - Final Guide: The Royal And Ancient Golf Club Of St Andrews, Income Statement

• School: Western University
• Department: Business Administration
• Course: Business Administration 2257
• Professor: Gomez Gomez

Document Summary

Bv > recoverable amount asset is impaired. Recoverable amount = fair value less selling costs. Dr impairment loss (expense) cr a/d equipment. Can only be returned to its carrying value before impairment. Dr a/d equipment cr impairment loss (expense) For an intangible asset with a finite life (limited), its cost must be allocated over its useful life amortization. Useful life = the shorter of 1) the estimated useful life and 2) the legal life. When criteria is met expenditures are considered to be development costs (asset) When a customer pays for goods/services on credit: Dr allowance for doubtful accounts cr accounts receivable. Step 1: dr accounts receivable cr allowance for doubtful. Bad debt expense (dr) allowance for doubtful accounts (cr) If negative debit then add to e/b then cr sum. E/b a4da = e/b accounts receivable x estimated % Bad debt expense = t/b a4da e/b a4da. Step 4: record dr bad debt expense cr allowance for doubtful accounts.