LADDER is a form of diversification in which investments with widely varying maturities are held within an investment portfolio. Spreading investments over a range of maturities reduces interest rate risk on reinvestment by averaging out interest rate cycles. This strategy assures a continuous cash flow over time with some potential sacrifice of optimum total return.
DEPRECIATION RECAPTURE is a provision contained in the Internal Revenue Code that makes excess depreciation taken on real property subject to income tax upon the sale or disposition of the property.
ALLOWANCE FOR BAD DEBTS is an account established to record a subtraction from ACCOUNTS RECEIVABLE, to allow for those accounts that will not be paid.
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