A company reported the following items for 2020: Accounts receivable balance, beginning of the year.. Allowance for uncollectible accounts balance, January 1, 2020 (credit) $ 177,000 44,000 Total credit sales during 2020.. Total collections on accounts receivable during 2020 Uncollectible accounts written off during 2020 Experience indicates that 13% of the uncollected accounts receivable at the end of each year ultimately will be uncollectible. What is the December 31, 2020 adjusting entry for uncollectible accounts? .550,000 360,000 15,000
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.
Subject :- Account
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