User Account

All Pages

Which provision for doubtful debts would focaccia ltd

Assignment Help Accounting Basics
Reference no: EM132593065

Focaccia Ltd has an Accounts Receivable balance of $20,000,000. The current downturn in the economy suggests the provision for doubtful debts needs re-consideration. The provision for doubtful debts before any adjustment is $100,000.The Financial Accountant estimates the provision for doubtful debts to be $3,000,000. The CFO however estimates the provision to be $2,000,000.

Required:

Question 1: Focaccia Ltd has two debt covenants included in its loan contract from its banker. It must maintain a current asset ratio of 2.5:1 and an interest coverage ratio of 4:1. If Focaccia Ltd is close to breaching its debt covenants which provision for doubtful debts would Focaccia Ltd's management prefer?

Reference no: EM132593065

Questions Cloud

Construct a stem and leaf display for the data : 1. Suppose the income in thousands of dollars for 40 employees in an Accounting firm is presented below.Refer to tha data set below and answer the question that
Journalize the entries required on each date : Journalize the entries required on each date. If no entry is required, simply skip to the next transaction. Refer to the Chart of Accounts for exact
How do geographically dispersed team collaborate effectively : How do geographically dispersed teams collaborate effectively? Please find at least three tools on the market that teams can use to collaborate.
Why a dollar today is worth more than a dollar in the future : Explain by providing good reasons on why a dollar today is worth more than a dollar in the future?
Which provision for doubtful debts would focaccia ltd : If Focaccia Ltd is close to breaching its debt covenants which provision for doubtful debts would Focaccia Ltd's management prefer?
Can a government achieve a low inflation rate : Related to "Business Cycles, Unemployment, and Inflation." Question: Can a government achieve a low inflation rate and low unemployment?
Calculate the depreciation expense for the second year : Depreciation Expense Using the Double-Declining Balance Method. Calculate the depreciation expense for the second year using double-declining balance method
What price water house coopers might mean : What Price water house Coopers might mean when they say Quindell's revenue recognition practices were "at the aggressive end of acceptable practice".
Decisions managers make differ based on level of position : Describe how the decisions managers make differ based on the level of the position such as supervisor, mid-level manager and senior manager.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd