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The Percentage-Of-Receivables Method for Estimating Uncollectible Accounts Is Commonly Referred

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The percentage-of-receivables method for estimating uncollectible accounts is commonly referred to as the balance sheet method,because the estimate of bad debts is based on a balance sheet amount-accounts receivable.


Definitions:

Earnings Per Share

A financial metric that measures the total earnings available to shareholders divided by the number of shares outstanding.

Debt/Equity Ratio

A ratio demonstrating the comparative levels of shareholders' equity and borrowed funds deployed to finance company assets.

Residual Dividend Policy

A strategy where dividends paid to shareholders are based on earnings left over after all operational and project expenses are covered.

After-Tax Earnings

The amount of net income remaining after all taxes have been deducted, reflecting the company's profitability after fulfilling tax obligations.

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