which-of-the-following-is-not-a-way-to-manage-earnings-a-change-the-method-for-bad-debt-estimation-b

Question

Which of the following is not a way to manage earnings?
A. Change the method for bad debt estimation.
B. Change the figure for the uncollectible percentage.
C. Under the balance sheet aging method, change the past-due categories.
D. Change the dates of common stock issuance

Puneet Prajapati · Accepted Answer

Okay, so we will understand the meaning Love income statement. For about that, we will understand that. What is the relation between income state Monday? Banish it. Very evils. Okay, so So income statement is one of the financial statements. Okay, Is Verratti financial statements which is prepared by an entity for every financial year? Okay. Who says the profitability off the car off the entity? Let&#x27;s suppose there is our business. Oh, selling household furnitures. Okay, so then they will prepare income statement for every financial year. No. Who recommended how much profit or loss he has undertaken in the current financial year? Okay, so this is the former off the income statement. Okay? I am. I&#x27;m writing only indicated former You understand the basics as the solution. We are going to the right. So they entered even and either making loss or profit. That&#x27;s very simple. Okay, now, so sewing balance sheet. So in balance sheet the display, we have ah, variable, which is no less common stock before this common stock. It refers to the shares which is assuring the stock market to raise the capital. Okay. Who is the capital for the purpose of financing projects? 40 purpose off running day to day expenses. Okay, so the issue common stock for that purpose. However, it does not have any relation with profit and loss account by that. So however, it has in Batic relation with profit and loss, but not an articulation by because it lives toe the raising of capital. It is logical raising capital. However, profit and loss is calculated to the outcome of the operations. Okay, so that is for the reason we have identified over correct choice. That&#x27;s it. That this choice d Okay, so issuance of common stuff will not the Lord be will not be the they who will manage or toe understand the implication of profit and loss. Okay, So that you can write down what I&#x27;ve written so far on bigger notebooks. Package elephants. However, choice did the correct answer. That&#x27;s all for a solution.

Puneet Prajapati · Answer

Okay. So people understand the meaning off. I also deceiving you for by that, even in this day, that gullible estimate My Which 13 B estimate that off How much we are doing on the count. But first of all, let&#x27;s understand the meaning of the houses. Okay, So when I said it is Mr G, who is that? Is this one? Yeah. Who is in dealing Lol Foods and beverages. I did it. Mr Be So, Mr Visa, Most of my through Mr J. So, Mr J soldiers serving words off Ma Myst December, Mr. But Mr Be their customers because the muscles to be set they gathered. You okay for Mr J agreed with this, however. What happens then? The time arrives, okay. When? Their time when I used to be. Well, Mr J. Mr. B, as here. But before that twisted Mr Geezer there. Okay, I understand that the we even be able to deceive the amount that was recovered. That is completely from over by be sure Estimate that How much off there tomorrow. Okay, so Mr J follows Mr J emphasised estimation like this off that that expense. Okay, so there is a popular that It says that night. I suppose Mr Be asked for three months. So previously we big gun there, Mr. Be there didn&#x27;t bite unless disciples initially he asked for initially the passport agreements, but later balding guy. But Mr B, but not was not able to be with demons so he asked for. And the three months. But still he was not able to pay the any. Ask for another two months night twice He kept going in freezing, thinking on your feet. Have you so a popular? I think it says that when I love that about Okay, Mr Visa, that Mr J will be so when it is a person from home that from the amount of saying it&#x27;s become sylvan that keeps on increasing the credit here. Okay, so the provide the probability off recovering the amount the same from the doctor will become very, very, very nous because business entity or we can say it, Mr. G. However, Mr Back Mr B is only delaying via home, okay? He is not willing to pay the home otherwise, he was happy within in each other. Okay, so that process, which we have just disclosed Okay, that matches with choice D. It says that Why is that? Better violence, Steve Becoming old and old by the time passes. Okay, de priority off Recovering the money from the government will be very, very less so. That method We can also understand that methods as Manan cheap aging office. Okay, so packed matches get choice deep tries deed the correct answer. Okay, that&#x27;s all part of a solution. Thank you.

Puneet Prajapati · Answer

Okay, So the evil understand the meaning Off bedrooms. Followed by that we will understand there what other various types of travel in we will have while preparing financial papers. Okay, so it is this day which relates brief level summary off a goat balances off parties off parties. It is the statement which provides brief 11 summary of a call balances of parties with which the business entity business center ts john sector. Okay, although we have it a legal definition. However, people understand it. You are very simple and clear example. So first of all, please do understand that any business or we can see any business entity is established for the purpose off motive. Okay. Without anymore, we cannot have any type of business entity, but after table organization or non profitable. So let&#x27;s suppose ABC company has been established. Who on the profits. Okay, No. What happens in orderto only profit the physical abilities with more people, suppliers and much deeper customs so that it can on the profit that desire profit. Okay. No. What happens? Any transaction I need an election that would be done in the business entity. Either will have relations with making profit or relation with making yours or Leonard. Shelby can say any any transaction will be negative. IQ. I didn&#x27;t profit either. Don&#x27;t lost. Okay, no. Let&#x27;s suppose we have suppliers. So I&#x27;m going the specimen off plan bellies. Okay. So suppliers will always have a credit balance if they busy. Company is preparing its trial balance for the given fringe area. So that suppliers okay, who are acting as suppliers for a physical level. Apparatchik Parents books off a bicycle. However, that&#x27;s too much from bull. The basic companies like you could recover. The amount will have every balances. No. What happens? Let you suppose and the content was recorded. The transactions mist has has missed $50 chance. Now what happens? These repeated transactions will be recorded in Just take Glanville. It&#x27;s so adjusted. Club violence. You can magic too. What I went through, right? So that would be more Peter to you. Then You will when you will be devising all all of this stuff. Okay, just to try and balance will. So this So this is the north. I just took traveling with your car under recorded. Okay. It is not prepared to light Mr Elections Okay. That is like I have taken under recorded on their chins. Know what happens. There is also different version off plan balance. That is. We see that is very for us. Post closing travel. It&#x27;s not what it does most. Opposing trial balance will have all the combs. Classy. Fight correctly. Okay. What? And a Now, what happens? That adjuster driverless will be prepared so it will record every UN recorded transaction which have Bean, or which has been missed by the accounting employer business entity. Now what happens Post was in prevalence is the is the actual travel ins, which will be used to prepare the Palin ship and all of the accounts which will be classified impossible. Most closing prevalence will be correct. Or we can say that, like those accounts will never likely to miss any tradition. Okay, so our current solution matches with joy. See, that is forced closing plan balance, which will have a three transaction we can see which will have every account classified as correct. Okay, in correct order. So you can write over what I have returned so far. However, the correct choice, the correct choices, Joyce E. That&#x27;s all. Whatever solution

Puneet Prajapati · Answer

so let&#x27;s understand. Different solution. Okay, So we either in this time different, Different concept. Yeah. No. What is there definite? Except it is the concept. What is the concept? Which? Which the neighbors, the entity not do record the transaction. Okay. North to record the transaction. Even if yes has bean big receive in in? I didn&#x27;t find insecure. Okay, big understanding through an example. Let&#x27;s suppose there&#x27;s a Mr B and hated Mr B. Know what happens. Mr is dealing in business. Off foods and beverages. It&#x27;s selling food restaurants off. This is basically so Mr A is basically so Mr Re is dealing in restaurant services. Okay? No. What happens, Mr. B is the amount in advance 40 delivery off foods and beverages. Okay, Mr B B. Baby alone. I would be alone in advance for Bolivia for delivery of goods and services. Who? Mr B. Okay. Know what happens? Let&#x27;s suppose the payment has been done in an injury in line, but the delivery has to be ready financially. Year Okay. The following year? No, that that received off income will not be reportable incurring financial that this financial year. But so what is the trucks off the field concept that history, even if the amount has been received in currently it in advance, okay. For delivery of goods and services in future. Yet even then, the amount of Lord very portable in are infinite. It&#x27;s not difficult in a current. So this is the example. What? Now let&#x27;s come cloven example that Let&#x27;s suppose there is Mr a again on David&#x27;s Mr C. Okay, now what happens? Mr. E has big some amount for purchase of raw material. Forget, you know, being in the moment. Eight months. Okay, I know what happens. So Mr C says Okay, I have received the advance about but I will believer the raw material in financial year the next financial year. Okay, if financial Year two means next financial year fall. Okay. So, Roma devia What? Rahman either. Okay, No. Even when that Mr. Even when Mr He has paid the amount for raw material. But Jason, advance in financially. The amount will not very poor develop until it. Because it does not relate to financial year. Actually, it actually leads to financially your toe. Okay, so that concept will be bonus. Definitely one set. Okay, So the ocean is as just which off the falling Mettler methodology has mean Don&#x27;t mess. OK, so our correct choice. So So our correct choice. It is definitely okay back this choice. Be okay. So you can George down. She number one and she number Do on your notebooks for future reference. However, we have the right Never solution back this choice.

Puneet Prajapati · Answer

Okay, so let&#x27;s understand the current solution, but before moving to the city should be will understand the cool concept. Okay, so it is actually a matter on the basis of which accounting is done in many, almost every over. In addition. Okay, in beautifully. It is a method the cheese employed by an entity do regard the expense or income it respective off it respective. Off making its spirit. What receiving be David? However, we have return a technical definition here. It will be more clear to you. Then we will understand it whom the wigs are. Okay, so let&#x27;s move. For example, by let&#x27;s suppose there is a Mr a who isn&#x27;t bailing off. Let me judge, OK? And they did. Mr. B, who is that estimate and was Mr D Okay, so Mr is in Mr B&#x27;s estimates. So, Mr Raising beating off furniture like selling furniture, they just a bit no. What happens just does a sort of meticulous to be so where to find me, Mr Bean. But Mr Besart mystery that he will pay off later funding time like within money order. Mr. B is not going to pay omitted. So in that case, just sold for nature off one game when your daughters okay? No, Mr E record this amount as is in in his books off balance by that. So because the upper World concepts A&#x27;s, it is a matter which isn&#x27;t hard financially to record the expense or income it respect do off. Making experiment off expense. Receiving the favorite. Okay, so Mr A. Will record $1000 as is in community books off a couch as predict accruals concept. Because the concept is even when the emergency services have been provided to a customer. But the payment has been received immediately even then. Even then, the business and record the value of goods and services as its income. Okay, next come to our example, inch support the mystery. And there is ABC company. Is that beautiful? Don&#x27;t. Okay, so Mr Mr Lazy complete provided some services. You cooked any foot like he can save because appreciates on point services when you read it services to Mr A being on it. Okay, now what happened? Mr is like to Mr ABC Company that I will pay you in later point in time. When I received the amount for amount from my customers. Okay, so let&#x27;s in the services, the services it was. But Oh, I wonder if voters okay, Know what happens? Mr. A will record $200 as his expense, because even when the phone has not being fair, but the services has bean, the services have bean a very by Mr It. Okay, so that implies Mr A. Has to pay these these expenses in a little on the time, in fact, is right. $200. It becomes reportable in the current financial year. Okay, because I could look on sixties that then ever the book, their homes or services will be provided or the the expenses will be encourage. The amount will be recorded in that financially, even when the payment has will be made or received in next financial year or subsequent. Manage. So you can know down. Example. One example. People along victor, definition of the concept get a clear idea of how the I that extension. So, yeah, I love it. The next solution and what is diabetic solution? The right choice, like choices. A. Okay, because only the well concept allows such methodology to record the transaction smoking. So that&#x27;s all. Okay, so that&#x27;s on forever. Solution. Thank you.

Puneet Prajapati · Answer

Okay, so we are going to understand the trial balance. Okay for her by that Beeville indistinct the hallway. How weekend you hear a different version of travel buttons all together. Okay, so it is. Ah, summarised Form off on the ground. Bellen. Sears! Okay. Who the pair? Bellen ship. Okay, so, first, if I Let&#x27;s suppose all lovey every forever be everything. The technical definition, however, leaving in this day that how booties toward different version of events. Let&#x27;s suppose there are 100 thousands of transaction in a business entity. Okay? Because of business, entity has to deal with multiple times multiple supplies to run the business keeps will actually 10,000 evictions. Okay, so in accounting is employed Lettuces entity Who records the transaction? Okay, So older by that, the content it was those projections. Okay, after posting the on my back, the So what? What step? The posting give us It gives ah, high level pale off all the account balances. Okay, there s our pal. Balance gives us summarize form of competences and from travel INTs, VP, daily bed and shit. However, I&#x27;m interfering. The second possessed with the definition, like my drawing the arrow. However you can right this example. Very clear. Okay, I&#x27;m drying the arrow to make the things very, very clear. Okay, so balance sheet is the final step in patient off hundreds of statements and their trial balance is the lots last stepping stone to abandon ship. Okay, now, let&#x27;s suppose the counting Mrs 50 Transactions deck would very, very important from the business point of view. So those 52 elections were left to be recorded forward by that left, people stared, and their effect was also Lord implant balance. So? So the banshee per patient will be wrong. Okay? No. What happens? There comes the concept. A concept off. And just in 12 minutes. Well, that rescue, okay? And just simply ambulance water. What? It will have just take a lord. So the ambulance will off course have the effect off 10,000 transition. However, when we will say when we say that adjusted evidence, it will also have the Fecteau 50 transactions. Okay. Now, from these total effects, they will prepare over Maren. She? But what happens? These salvation? Well, in total, I have a single effect on a single ago. Okay, So these these people on the chin. We&#x27;ll have a symbol single effect on a single ago. Like the combined effect we can see noticing the combined effect on a single account that we know that that people less do you notice? So under Dana thinks what we have in the earnings we have our perfect our laws and nurtured during the current financial year. Retained earning balance at the beginning often engineer and any wouldn&#x27;t be through the shared orders. OK, so these 50 transaction, or we can see any number of transaction will have effect will ever direct effect on this. Okay, so now what we have what we have that the balance on the balance of retained earnings are just to trial balance and Bill in chief will be different by that. So because 52 election will have a combined effect on tenements and that is why we have different parents over Dana, Knicks, honor, justice, tell evidence in different balance sheet level. Okay, so that that matches with So they retained earnings that count, which will have different. But it&#x27;s on both the statements. Okay. And back matches with joi sey engages off, but in Kocian. Okay, So the correct choice is joi sey. Okay, that&#x27;s all for our solution. Thank you

Problem

Which of the following is true about earnings man…

Problem 15 Easy Difficulty

Which of the following is not a way to manage earnings?
A. Change the method for bad debt estimation.
B. Change the figure for the uncollectible percentage.
C. Under the balance sheet aging method, change the past-due categories.
D. Change the dates of common stock issuance

Answer

Related Courses

Principles of Accounting Volume 1: Financial Accounting

Related Topics

Discussion

Top Educators

Recommended Videos

Watch More Solved Questions in Chapter 9

Video Transcript

Mitchell Franklin, Patty Graybeal, Dixon Cooper

Principles of Accounting Volume 1: Financial Accounting

What do you need help with?

Textbooks

Ask a question

Courses

AI Tutor

Principles of Accounting Volume 1: Financial Accounting

Mitchell Franklin, Patty Graybeal, Dixon CooperPrinciples of Accounting Volume 1: Financial Accounting

Mitchell Franklin, Patty Graybeal, Dixon Cooper

Principles of Accounting Volume 1: Financial Accounting