Dec 6 ● ● Paid the November Utilities bill of $5,500 (this was already recognized as an expense in November). (check #522 payable to Progress Energy) Specifically wrote off the receivable balance owed by Clayton as uncollectible. This bad debt had been previously estimated. Received $15,000 in cash on the accounts receivable from Summers. Bought inventory from a new supplier, Bailey Corp (Vendor# 210-25) on credit for the gross amount of $85,000 (invoice #CC1206). Bailey's terms for repayment are 3/10, n/30. Reminder: Wolfpack uses the net method for recording purchase discounts. Received payment in full from Carroll.
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.
indicate in the margin beside each transaction the journal the transaction should be recorded in (ex. SJ, PJ, CRJ, CDJ, or GJ) and the special
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