Question
QUESTION 37 At year-end, Vesuvius Inc. reported gross receivables totaling $120,000. Because of the uncertainty in its collection, the firm recognizes bad debt expense of
QUESTION 37
- At year-end, Vesuvius Inc. reported gross receivables totaling $120,000.
Because of the uncertainty in its collection, the firm recognizes bad debt expense of $12,000 in its income statement. For tax purposes, the bad debt expense cannot be deducted until the receivables are deemed worthless.
At the end of the year, what is the tax base of the receivable?
|
| a. | $0 |
|
| b. | $108,000 |
|
| c. | $120,000 |
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Accounting for Non-Accounting Students
Authors: John R. Dyson
8th Edition
273722972, 978-0273722977
