Receivable Flashcards
1
Q
direct write-off method
A
It is not normally consistent with GAAP and accrual accounting.
Its use tends to result in an overstatement of accounts receivable on the balance sheet.
Under this method, bad debt expense is recognized when a specific account is determined to be uncollectible.
2
Q
2/15 net 30 mean?
A
2% off if paid within 15 days
or else full amount due in 30 days
3
Q
record bad debt
A
DEBIT: bad debt expense
CREDIT: allowance for uncollectible
4
Q
write off
A
DEBIT: allowance for uncollectible
CREDIT: A/R
5
Q
recovery of previously written off a/r
A
DEBIT: A/R
CREDIT: allowance for uncollectible
DEBIT: Cash
CREDIT: A/R
6
Q
when increasing allowance for doubtful account, is it debit or credit?
A
credit balance.
