On january 1, 2017, ridge road company acquired 25 percent of the voting shares of sauk trail, inc., for $3,500,000 in cash. both companies provide commercial internet support services but serve markets in different industries. ridge road made the investment to gain access to sauk trail's board of directors and thus facilitate future cooperative agreements between the two firms. ridge road quickly obtained several seats on sauk trail's board which gave it the ability to significantly influence sauk trail's operating and investing activities.
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Acompany has $80,000 in outstanding accounts receivable and it uses the allowance method to account for uncollectible accounts. experience suggests that 6% of outstanding receivables are uncollectible. the current credit balance (before adjustments) in the allowance for doubtful accounts is $1,200. the journal entry to record the adjustment to the allowance account includes a debit to bad debts expense for $4,800. true or false
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On january 1, 2017, ridge road company acquired 25 percent of the voting shares of sauk trail, inc.,...
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