Solution-What reliable would recognize gross profit be

What reliable would recognize gross profit be

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Reference no: EM132562218

Question 1: Reliable Enterprises sells distressed merchandise on extended credit terms. Collections on these sales are not reasonably assured, and bad debt losses cannot be reasonably predicted. It is unlikely that repossessed merchandise is in condition to be re-sold. Therefore, Reliable uses the IFRS method for significant uncertainty in collectibility. Merchandise costing $30,000 was sold for $55,000 in 2012. Collections on this sale were $20,000 in 2012, $15,000 in 2013, and $20,000 in 2014. Ignore interest charges. In 2012, Reliable would recognize gross profit / (loss) of:

Select one:

a. $25,000.

b.$(10,000).

c.$0.

d. $20,000.

Reference no: EM132562218

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What reliable would recognize gross profit be

Reference no: EM132562218

Reference no: EM132562218

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