Security Service Company's Accounts Receivable account shows a debit balance of $104,000 at the end of the year. An aging analysis of the individual accounts indicates estimated uncollectible accounts to be $6,700. Prepare the journal entry to record the uncollectible accounts expense under each of the following independent assumptions: a. Allowance for Uncollectible Accounts has a credit balance of $800 before adjustment. b. Allowance for Uncollectible Accounts has a debit balance of $800 before adjustment. What is the balance of Allowance for Uncollectible Accounts after each of these adjustments?
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.
Security Service Company's
a. Allowance for Uncollectible Accounts has a credit balance of $800 before adjustment.
b. Allowance for Uncollectible Accounts has a debit balance of $800 before adjustment.
What is the balance of Allowance for Uncollectible Accounts after each of these adjustments?
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