Answer:
What is Carson Company's net realizable value of the accounts receivable at the end of 2016?
Dr Accounts receivable $ 22,000
Explanation:
1. Earned $150,000 of revenue on account
Dr Accounts receivable $ 150,000
Cr Sales $ 150,000
2. Collected $125,000 cash from accounts receivable
Dr CASH $ 125,000
Cr Accounts receivable $ 125,000
Adjusted the accounting records to reflect management's belief that $3,000 of the accounts receivable balance would be uncollectible.
Dr Bad Debt Expense $ 3,000
Cr Allowance for Uncollectible Accounts $ 3,000
What is Carson Company's net realizable value of the accounts receivable at the end of 2016?
Dr Accounts receivable $ 22.000
The net realizable value of the accounts have to consider the estimated value that would be uncollectible, this case :
$150,000 Credit Sales
-$125,000 Cash from Accounts Receivable
-$ 3,000 Accounts Receivable balance that would be uncollectible.
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$ 22,000 ==> Net realizable value of the accounts receivable
