What is the net realizable value of accounts receivable at the end of year, given the following information: Balance in Accounts Receivable at end of year, $104,000 Balance in Allowance for Doubtful Accounts, beginning of year, $2,000 debit Write-offs during year, $5,000 Bad debt expense for year, $9,000 Recoveries during year of accounts previously written-off, $2,000
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.
What is the net realizable value of accounts receivable at the end of year, given the following information:
Balance in Accounts Receivable at end of year, $104,000
Balance in Allowance for Doubtful Accounts, beginning of year, $2,000 debit
Write-offs during year, $5,000
Bad debt expense for year, $9,000
Recoveries during year of accounts previously written-off, $2,000
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