A Guarantee to Be Enforceable Must Be in Writing; However,a

question 98

True/False

A guarantee to be enforceable must be in writing; however,a promise of indemnity does not have to be in writing to be enforceable.

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Definitions:

Expense Recognition Principle

An accounting principle that dictates the conditions under which an expense is recognized and reported in the financial statements.

Percent of Receivables Method

An accounting technique used to estimate the amount of a company's accounts receivable that will not be collected, based on a percentage of the total accounts receivable.

Perpetual Inventory System

This is an accounting method that continuously updates inventory records for each sale or purchase of inventory.

Allowance for Doubtful Accounts

A contra-account that reduces the total receivables reported on the balance sheet to reflect the amount expected to be collected.