Under Accounting Standard NZ IAS 39, the Statement in Relation

question 49

Multiple Choice

Under accounting standard NZ IAS 39, the statement in relation to changes in accounting for bad and doubtful debts that is true is:

• A) The name of bad and doubtful debts expense may be changed to 'impairment loss' on debtors.
• B) An impairment test will be applied so that debtors will not be carried in the balance sheet at more than is expected to be recovered.
• C) The name of the contra asset account 'allowance for doubtful debts' may be changed to 'allowance for impairment loss'.
• D) All of the statements are true.

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Definitions:

Indefinite Useful Lives

An accounting classification for intangible assets that are not expected to expire or have an end to their useful economic life.

Auditors

Professionals responsible for examining and verifying the accuracy of financial records and statements of an organization.

Investment Account

An account held at a financial institution that contains investments like stocks, bonds, mutual funds, and ETFs, potentially helping the owner achieve long-term financial goals.

Dividends

Payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders.