If It Becomes Known After Reporting Date That a Debtor

question 16

Multiple Choice

If it becomes known after reporting date that a debtor is now not able to pay a material amount that is owed to the reporting entity,the appropriate action according to AASB 110 is to:

• A) Adjust the balance of accounts receivable and write off the bad debt and make a note disclosure that this event occurred after reporting date.
• B) Adjust the balance of accounts receivable and write off the bad debt.
• C) Disclose the event in the notes to the accounts.
• D) Do nothing this period but write the debt off in the accounts for the next period.

---

Definitions:

Re-express

A statistical technique used to transform data in order to make its distribution more closely approximate the normal distribution, improving the interpretability or analysis.

Linear Relationship

A relationship between two variables where the change in one variable is directly proportional to the change in another variable.

Chocolate Consumed

The amount of chocolate intake by an individual or group over a specified period.

Automobile Accidents

Events involving motor vehicles that result in damage, injury, or fatalities.