Peggy Is in the Business of Factoring Accounts Receivable

question 82

Multiple Choice

Peggy is in the business of factoring accounts receivable. Last year, she purchased a $30,000 account receivable for $25,000. This year, the account was settled for $25,000. How much loss can Peggy deduct and in which year?

• A) $5,000 for the current year.
• B) $5,000 for the prior year and $5,000 for the current year.
• C) $5,000 for the prior year.
• D) $10,000 for the current year.
• E) None of the above.

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Definitions:

Winner-Take-All Approach

A competitive strategy or situation where the top performer or winner receives all the rewards or benefits.

Shared Training Facilities

Training resources or locations that are used collaboratively by multiple organizations or departments to reduce costs and improve efficiency.

Inter-Unit Conflict

Disagreements or disputes that arise between different units or departments within an organization, potentially affecting its functioning and performance.

Conflict Sources

The origins or causes of disagreements or disputes, which can range from personal differences to conflicting objectives or resources.