ALLOWANCE METHOD Definition

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ALLOWANCE METHOD is the accepted way to account for bad debt. Bad debt expense may be based on the percent of credit sales for the period, an aging of the accounts receivable balance at the end of the period, or some other method, e.g., percent of accounts receivable.

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SURCHARGE is a charge added on top of another charge for a specific service, product or purpose.

BANK BASE RATE is the annual interest rate on which British banks calculate lending charges (minimum lending rate).

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