Q4. At December 31, 2021, Omega Co. reported the following information on its Balance Sheet: Doubtful Receivable $100,000 $ 60,000 Allowance for D/R Required: During 2022, the company had the following transactions related to receivable. 1. Sales made on account 2. Collections of accounts receivables Write-offs of accounts receivables 3. 4. Receivables proved to be doubtful 5. Recovery of doubtful receivables $2,500,000 $2,100,000 $ 75,000 $ 120,000 $ 150,000 Prepare the journal entries to record each of the above transactions. Open the T accounts, enter the balances and post the transactions.
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.
Subject: accounting
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