Question

Bell Canada Enterprises (BCE) is Canada's largest communications company and a leading provider of wireline and wireless communications services, Internet access, and data and video services to residential, business, and wholesale customers. As at December 31, 2011, BCE reported trade accounts receivable of $3,069,000,000 and allowance for doubtful accounts of $105,000,000. Vecima Networks Inc., founded in Saskatoon, Saskatchewan in 1988, designs, manufactures, and sells products that enable broadband access to cable, wireless, and telephone networks. Vecima sells its products through offices across Canada, the United States, and internationally, to original equipment manufacturers, system integrators, cable operators, and other service providers. As at June 30, 2011, Vecima reported trade accounts receivable of $16,497,000 and allowance for doubtful accounts of $841,000.
a. Compute the percentage of the allowance for doubtful accounts to the accounts receivable as at December 31, 2011, for BCE.
b. Compute the percentage of the allowance for doubtful accounts to the accounts receivable as at June 30, 2011, for Vecima.
c. Discuss possible reasons for the difference in the two ratios computed in a. and b.


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  • CreatedSeptember 15, 2015
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