The Following Note Disclosure Is Taken from the 2018 Annual

question 176

Essay

The following note disclosure is taken from the 2018 annual report to shareholders of Winchester International Corporation.

NOTE 5: ALLOWANCE FOR LOAN LOSSES

The allowance for loan loss is maintained at a level to absorb probable losses inherent in the loan portfolio. This allowance is increased by provisions charged to operating expense and by recoveries on loans previously charged off, and reduced by charge-offs on loans.

The following is a summary of the changes in the allowances for loan losses for three years:

Winchester also reported (in thousands) in its comparative balance sheet that it held Loans receivable, net, of $6,869,11 and $6,819,209 at December 31, 2018, and December 31, 2017, respectively.
-What kind of account is the Allowance for Loan Losses in Winchester's financial statements?

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Definitions:

Shy

The characteristic of being reserved or having a reluctance to speak, act, or present oneself in public due to nervousness or a lack of confidence.

Kagan

Refers to Jerome Kagan, a developmental psychologist known for his work on temperament and the development of fear and anxiety in children.

Development Milestones

Significant points in an individual's life or development process where crucial skills, behaviors, or physical capabilities are expected to be achieved.

Maturation

The process by which individuals grow and develop physically, emotionally, and intellectually over time, largely as a result of genetic programming.