3) Suppose, for example, that our ledger account for Office Supplies shows a value of $1200 at the end of our fiscal period of the month of January. However, a physical count of the Office Supplies on hand shows we really only have $560 worth of supplies left on our shelf. What would the adjusting entry in the general journal look like? 1.Debit - Supplies Expense $1200 </> Credit -Supplies $1200 2.Debit - Supplies Expense $560 </> Credit -Supplies $560 3.Debit - Supplies Expense $640 </> Credit -Supplies $640 4.Debit - Supplies $560 </> Credit -Supplies Expense $560
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
3) Suppose, for example, that our ledger account for Office Supplies shows a value of $1200 at the end of our fiscal period of the month of January. However, a physical count of the Office Supplies on hand shows we really only have $560 worth of supplies left on our shelf. What would the
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