The ledger of AISExperts Inc. contained the following balances after adjustment, but before closing, on December 31, 2021, the end of the current year. This means the below account balances are normal balances: Accounts payable 80400 Accounts receivable 115580 Sales returns and allowances 20000 Accumulated depreciation – equipment 27540 Depreciation expense 800 Interest revenue 1100 Unearned sales revenue 2000 Cash 75470 Common stock (10,000 shares outstanding) 100000 Sales discounts 12000 Cost of goods sold 632150 Dividends declared 18100 Equipment 140450 Insurance expense 4500 Dividends payable 2000 Allowance for doubtful accounts 9500 General expenses 114250 Interest expense 4600 Merchandise inventory 154250 Prepaid insurance 12325 Retained earnings ? Marketable securities 10000 Dividend revenue 10000 Treasury stock 1000 Salaries payable 18560 Sales 1018250 Selling expenses 140210 a statement of retained earnings
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.
The ledger of AISExperts Inc. contained the following balances after adjustment, but before closing, on December 31, 2021, the end of the current year. This means the below account balances are normal balances:
Accounts payable
80400
115580
Sales returns and allowances
20000
27540
Depreciation expense
800
Interest revenue
1100
Unearned sales revenue
2000
Cash
75470
Common stock (10,000 shares outstanding)
100000
Sales discounts
12000
Cost of goods sold
632150
Dividends declared
18100
Equipment
140450
Insurance expense
4500
Dividends payable
2000
Allowance for doubtful accounts
9500
General expenses
114250
Interest expense
4600
Merchandise inventory
154250
Prepaid insurance
12325
?
Marketable securities
10000
Dividend revenue
10000
1000
Salaries payable
18560
Sales
1018250
Selling expenses
140210
a statement of retained earnings
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