[Anonymous]

Hi, I am having a problem with research questions on CPAExcel. I’m not sure if it is the picky nature of the interface or if I have a mental block. Here’s the question:

A wholesaler recognized a significant write-down of a large receivable. The wholesaler does not estimate bad debts as a general rule. The cause of the write-down was the unexpected failure of a large manufacturer which had purchased substantial inventory from the wholesaler in the past. Is this type of loss generally classified as extraordinary? Can such a loss ever be considered extraordinary? Provide the authoritative literature for your conclusion.

The codification according to CPAExcel is:

225 20 45 4

I believe it should be:

225 20 45 4A

4A addresses receivables specifically whereas 4 only notes that there are a set of items that are never considered extraordinary (but doesn’t mention what they are). In my mind, stopping at 4 is incomplete because it doesn’t specifically address receivables.

Thanks!