Valuing accounts receivable Flashcards
1
Q
Bad debt expense
A
An expense to record uncollectible receivables
2
Q
Allowance for doubtful accounts
A
- Contra asset account
- Deducted from gross accounts receivables to report receivables at their net realizable value
3
Q
Net realizable value
A
- The amount of receivables expected to be collected
- Accounts Receivables - Allowance for doubtful accounts
4
Q
The Write-off Method
A
Dr. Bad debt expense
Cr. A/R
5
Q
The Allowance method
A
- Recording estimated uncollectible
- Writing off uncollectible accounts
- Collection/recovery of a previously written off accounts
6
Q
Recording estimated uncollectible
A
Dr. Bad debt expense
Cr. Allowance to doubtful accounts
7
Q
Writing off uncollectible accounts
A
Dr. Allowance for doubtful accounts
Cr. A/R
8
Q
Collection/Recovery of a previously written off account
A
Dr. A/R
Cr. Allowance for doubtful accounts
Dr. Cash
Cr. A/R
