Glossary - Accounts receivable Amounts owed by customers on...

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Accounts receivable Amounts owed by customers on account. (p. 386). Accounts receivable turnover ratio A measure of the liquidity of accounts receivable; computed by dividing net credit sales by average net accounts receivable. (p. 403). Aging the accounts receivable The analysis of customer balances by the length of time they have been unpaid.(p. 393). Allowance method A method of accounting for bad debts that involves estimating uncollectible accounts at the end of each period. (p. 389). Average collection period The average amount of time that a receivable is outstanding; calculated by dividing 365 days by the accounts receivables turnover ratio. (p. 404). Bad Debts Expense An expense account to record uncollectible receivables. (p. 388). Cash (net) realizable value The net amount a company expects to receive in cash. (p. 389). Direct write-off method A method of accounting for bad debts that involves expensing accounts at the time they are determined to be uncollectible. (p. 388). Dishonored note A note that is not paid in full at maturity.
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Glossary - Accounts receivable Amounts owed by customers on...

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