41. The value associated with a dishonored note receivable is removed from the statement of financial position since the note is no longer negotiable.
42.Short-term receivables appear in the current assets section of the statement of financial position above short-term investments.
43. In the statement of financial position, companies need only report the cash (net) realizable value of accounts and notes receivable.
44. The accounts receivable turnover ratio is computed by using two accounts reported on the statement of financial position, accounts receivable and allowance for doubtful accounts.
45. U.S. GAAP accounts for short-term receivables at amortized cost, adjusted for allowances for doubtful accounts, whereas IFRS requires fair values for receivables.
46. The criteria used to derecognize a receivable under IFRS uses a combination of an approach focused on risks and rewards and loss of control.
47. The accounts receivable turnover ratio is computed by dividing total sales by the average net receivables during the year.
48. Both the gross amount of receivables and the allowance for doubtful accounts should be reported in the financial statements.
49. Notes receivable represent claims for which formal instruments of credit are issued as evidence of debt.
50. The two methods of accounting for uncollectible accounts are (a) percentage of sales and (b) percentage of receivables.
51. The account Allowance for Doubtful Accounts is closed out at the end of the year.
52.In order to accelerate the receipt of cash from receivables, owners may sell the receivables to another company for cash.
53. When counting the exact number of days to determine the maturity date of a note, the date of issue is included but the due date is omitted.
54. A note is dishonored when it is not fully paid at maturity.
55. Short-term receivables are reported in the current assets section after short-term investments.