Accounting for Accruals: Advanced Topics Related to Receivables

1. Explain the importance of offering credit terms to customers.

2. Explain how the allowance method of accounting for bad debts affects financial statements.

3. Show how the direct write-off method of accounting for bad debts affects financial statements.

4. Explain how accounting for credit card sales affects financial statements.

5. Explain how accounting for warranty obligations affects financial statements.

6. Explain the effects of the cost of financing credit sales.

7. Show how discount notes and related interest charges affect financial statements. (Appendix)