Baddebtexpense allowancefordoubtfulaccounts chapter 7

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Unformatted text preview: Reports receivables on balance sheet at the CORRECT net realizable value (each and every year). Companies apply this method using either single composite rate (% of total A/R balance) OR an A/R aging schedule (referred to as the A/R Aging Method). Chapter 7-31 LO 5 Explain accounting issues related to valuation of accounts receivable. Uncollectible Accounts Receivable Uncollectible Accounts Receivable Percentage-of-A/R Approach Percentage-of-A/R Approach What entry would Wilson make assuming a beginning balance of zero in the allowance account? Bad Debt Expense Allowance for Doubtful Accounts Chapter 7-32 37,650 37,650 LO 5 Explain accounting issues related to valuation of accounts receivable. Uncollectible Accounts Receivable Uncollectible Accounts Receivable Percentage-of-A/R Approach Percentage-of-A/R Approach What entry would Wilson make assuming allowance account had a CR balance of $800 before adjustment (an overestimate from the previous year’s estimate)? Bad Debt Expense ($37,650 – $800) Allowance for Doubtfu...
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