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eBook Show Me How Nature of Uncollectible Accounts MGM Resorts International owns and operates hotels and casinos including the MGM Grand and the Bellagio in Las Vegas, Nevada. As of a recent year, MGM reported accounts receivable of $747,981,000 and allowance for doubtful accounts of $90,775,000., Johnson & Johnson manufactures and sells a wide range of healthcare products including Band- Aid bandages and Tylenol. As of a recent year, Johnson & Johnson reported accounts receivable of $14,346,000,000 and allowance for doubtful accounts of $248,000,000. a. Compute the percentage of the allowance for doubtful accounts to the accounts receivable for MGM Resorts International. Round to one decimal place. % b. Compute the percentage of the allowance for doubtful accounts to the accounts receivable for Johnson & Johnson. Round to one decimal place. % c. Possible reasons for the difference in the two ratios computed in (a) and (b) include: a. Casino operators historically lose money on operations. b. Casino operators have larger accounts receivable. c. Individuals who may have adequate creditworthiness could overextend themselves and lose more than they can afford if they get caught up in the excitement of gambling. d. Casino operations experience greater bad debt risk because it is difficult to control the creditworthiness of customers entering the casino.

MGM Resorts International owns and operates hotels and casinos including the MGM Grand and the Bellagio in Las Vegas, Nevada. As of a recent year, MGM reported occounts receivable of $747,981,000 and allowance for doubtful accounts of $90,775,000, Johnson a Johnson manufactures and sells a wide range of healthcare products including BandAud bandages and Tylenol? 2, As of a recent vear, Johnson \& Johnson reported accocints receivable of $14,346,000,000 and allowance for doubtful accounts of $248,000,000. a. Compute the percentage of the allowance for doubtful acoounts to the accounts receivable for MGM Riesorts International, Round to one decinsal place. b. Compute the percentage of the allowance for doubtful accounts to the accounts recevable for Johnson a Johnson. Round to one decimal place. 46 c. Possible reasons for the difference in the two ratios computed in (a) and (b) include: a. Casino eperators histoncally lose money on operations. b. Casine operators have larger accounts recervabie. c. Individusis who may have adequate creditworlhiness could overextend themselves and lose more than they can afford if they get caught up in the exsitement of gambling. d. Casino opentions expenence greater bad debt risk because it is difficult to control the creditworthiness of customers entering the casino

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