Describe how a back-to-back loan is used
What will be an ideal response?
Answer: Back-to-back loans, often referred to as fronting loans are often used to finance affiliates in countries with high interest rates or restricted capital markets. In a typical loan, the parent company deposits funds with a bank in a country that in turn lends the money to a subsidiary in another country.
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The following information is from the 2017 records of Robin Antique Shop
Accounts receivable, December 31, 2017 $44,000 (debit) Allowance for Bad Debts, December 31, 2017 prior to adjustment 1,100 (debit) Net credit sales for 2017 176,000 Accounts written off as uncollectible during 2017 11,000 Cash sales during 2017 27,000 Bad debts expense is estimated by the percent-of-sales method. Management estimates that 5% of net credit sales will be uncollectible. The ending balance of the Allowance for Bad Debts account after adjustment will be ________. A) $9,900 B) $9,050 C) $11,250 D) $7,700
Courts may "pierce the veil" of a "C" corporation and hold shareholders liable for the debts of the corporation.
a. true b. false