The financial data for A Company is the following: Balance sheet data (in $ millions) at 12/31 Accounts receivable Less: allowance for doubtful accounts Accounts receivable (net) 2021 $ 500 150 350 2020 $ 450 140 310 Income statement data, year ending 12/31 Net sales (assume all on credit) Uncollectible accounts expense 1. Compute the accounts receivable turnover ratio for 2021 and 2020. 2. Wat amount of accounts receivable was collected in 2021? 3. How much was the write off of uncollectible accounts in 2021? $33,400 100 $21,500 110 2019 $410 160 250 $19,200 95
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.
Trending now
This is a popular solution!
Step by step
Solved in 5 steps
