An analysis and aging of Serrano Company's accounts receivable at December 31, 20XX disclosed the following: Accounts receivable - 9,000,000 Allowance for doubtful accounts per book - 500,000 Computed allowance based on aging of receivables - 640,000 On December 31, 20XX, what is the net realizable value of accounts receivable?
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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.
17. An analysis and aging of Serrano Company's
Accounts receivable - 9,000,000
Allowance for doubtful accounts per book - 500,000
Computed allowance based on aging of receivables - 640,000
On December 31, 20XX, what is the net realizable value of accounts receivable?
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