Asked by Mlebinge Endani on May 21, 2024

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Although IFRS contain the same basic guidelines for accounting for cash and receivables as U.S.GAAP, some differences exist.Which of the following accounting treatments differs under IFRS versus GAAP?

A) the accounting for cash (sales) discounts
B) the classification of some receivables as "available for sale"
C) the accounting for pledging and assignment of receivables
D) the application of the allowance method of accounting for uncollectible accounts

IFRS

International Financial Reporting Standards, a set of accounting standards developed by the International Accounting Standards Board that guides the financial reporting for companies outside of the United States.

GAAP

Generally Accepted Accounting Principles, a common set of accounting rules and standards for financial reporting in the United States.

Pledging

The act of providing assets as security or collateral for a debt.

  • Identify and explain differences between IFRS and GAAP in accounting for cash and receivables.
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PN
Patricia NicoleMay 27, 2024
Final Answer :
B
Explanation :
Under IFRS, some receivables may be classified as "available for sale," which means they are reported at fair value with unrealized gains and losses included in other comprehensive income. This option is not available under GAAP. The accounting for cash discounts (A), pledging and assignment of receivables (C), and the allowance method of accounting for uncollectible accounts (D) are similar under both IFRS and GAAP.