In Order to Keep Accurate Records About the Collection of Cash

question 17

True/False

In order to keep accurate records about the collection of cash for a previously written off account,a business should re-establish the Accounts Receivable by debiting the receivable account.

---

Definitions:

Periodic Basis

An accounting method where transactions are recorded and financial statements are prepared at regular, specific intervals, such as monthly, quarterly, or annually.

Bondholders

Individuals or institutions that hold the debt securities issued by corporations or governments, entitled to receive interest payments and the principal repayment.

Premium Amortization

The gradual reduction of the premium paid above the par value of a bond, allocated over the bond's life.

Bond Amortization Schedule

A schedule that outlines the periodic reduction of the discount on bonds payable or the premium on bonds payable, along with the interest expense over the life of the bond.