Information about KKM Corporation’s Accounts Receivable on year end are the ff: 2015 2014 Accounts receivable, net USD4, 300, 000 USD 3, 500, 000 Allowance for doubtful accounts 1,580,000 770,000 Sales totaled USD45,000,000 for the year, with cash sales accounting for 40% of total sales. Uncollectible account write-offs amounted to USD500,000, while recoveries of previously written-off accounts totaled USD250,000. In 2015, how much was bad debt expense recognized? In 2015, how much money did KKM Corporation collected from their customers? Note* Accounts receivable should be in gross amount not the net amount before determining the answers.
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.
Information about KKM Corporation’s
|
|
2015 |
2014 |
|
Accounts receivable, net |
USD4, 300, 000 |
USD 3, 500, 000 |
|
Allowance for doubtful accounts |
1,580,000 |
770,000 |
Sales totaled USD45,000,000 for the year, with cash sales accounting for 40% of total sales. Uncollectible account write-offs amounted to USD500,000, while recoveries of previously written-off accounts totaled USD250,000. In 2015, how much was
Note* Accounts receivable should be in gross amount not the net amount before determining the answers.
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