Journal Entries: Journal entries are the basic entries recoded as per the transactions being entered into by the business in its day to day operations in a chronological order. Accounting rules regarding journal entries: • Balance increases when: assets, losses and expenses are debited and liabilities, gains and incomes get credited. • Balance decreases when: assets, losses and expenses get credited and liabilities, gains and incomes are debited. Accounts Receivable : Accounts receivable are the assets of the company as they depict the amount to be received in future from the customers to whom the products of the company have been sold. And thus it can be described as the potential asset addition sources hence an asset for the company. Bad Debts : Bad debts can be described as that value of accounts receivable which are regarded by the companies as no more collectible or the potential customers who were liable to make such payments are not in situation to do so. Hence bad debts are a loss and thus it ultimately decreases the assets of the company. To prepare: Journal entries.

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Chapter 9, Problem 4BPSB

To determine

Journal Entries:

Journal entries are the basic entries recoded as per the transactions being entered into by the business in its day to day operations in a chronological order.

Accounting rules regarding journal entries:

• Balance increases when: assets, losses and expenses are debited and liabilities, gains and incomes get credited.

• Balance decreases when: assets, losses and expenses get credited and liabilities, gains and incomes are debited.

Accounts Receivable:

Accounts receivable are the assets of the company as they depict the amount to be received in future from the customers to whom the products of the company have been sold. And thus it can be described as the potential asset addition sources hence an asset for the company.

Bad Debts:

Bad debts can be described as that value of accounts receivable which are regarded by the companies as no more collectible or the potential customers who were liable to make such payments are not in situation to do so. Hence bad debts are a loss and thus it ultimately decreases the assets of the company.

To prepare: Journal entries.

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