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Case 4 The following is the balance of PT ABC's account receivables as of 31Dec20X1 and 20X2: PT ABC calculates the allowance for impairment of
Case 4 The following is the balance of PT ABC's account receivables as of 31Dec20X1 and 20X2: PT ABC calculates the allowance for impairment of account receivables based on Expected Credit Loss (ECL) using a provision matrix. The provision matrix is prepared based on historical information and estimates of future macroeconomic factors. PT ABC estimates that there will be a decline in economic conditions over the next 2 years. The following is a forward-looking provision matrix as of 31Dec20X1 and 20X2: Required: 1) Calculate the allowance for impairment of account receivables as of Dec. 31, 20X2. 2) Analyze the effects of the impairment allowance to the related accounts in the financial statement for the year ended December 31, 20X2
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