Question:
As you learned in this week's reading, account receivables record bad debts or other promises to pay by debtors (Porter & Norton). To understand the accounting for the sale of investments and the generation of notes receivable, please reference:
Please respond to all of the following questions:
Does the suggestion by the vice president as to how to record the sale violate any accounting principle? If so, explain the principle it violates.
What would you do? Write a brief memo to the vice president explaining the proper accounting for the sale.