d) The trial balance before adjustment of Braxton Inc. shows the following balances. DEBIT CREDIT Accounts receivable $170,000 Allowance for doubtful accounts 1,750 Net Credit Sales $1,280,000 Journalize the Bad Debt Expenses assuming: i. 1.2% of Sales will be uncollectible 9% of gross accounts receivable will be uncollectible the same as part ii above instead there is a credit balance in Allowance for doubtful accounts of $1,700 and collected $2,100 from an account previously written off. ii.
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.
Step by step
Solved in 2 steps with 3 images
