Nabb & Fry Co. reports net income of $30,000. Interest allowances are Nabb $6,000 and Fry $5,100, salary allowances are Nabb $15,100 and Fry $11,000, and the remainder is shared equally. Show the distribution of income. (If an amount reduces the account balance then enter with a negative sign preceding the number e.g. -15,000 or parenthesis e.g. (15,000).) Salary allowance Interest allowance Remaining excess/deficiency Total division of net income $ $ Nabb Division of Net Income 15,100 6,000 17,500 $ $ Fry 11,000 5,100 12,500 $ $ Total 26,100 11,100 30,000
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.
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