Which of the following statements is true? Recognition of a recourse liability will make a loss on the sale of receivables smaller than it would otherwise have been. The category "trade receivables" includes advances of cash to officers, employees, and subsidiaries. If a company receives a note receivable on a sale and fails to recognize Discount on Notes Receivable, the company's net earnings for the period will be overstated. O Under the allowance method, the net amount reported for short-term receivables is decreased when a specific account receivable is determined to be uncollectible.