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1 year ago

4)which of the following is correct when bad debt expense is recorded at year-end? b) net accounts receivable will decrease.

Business

1 answer:

fiasKO [112]1 year ago

5 0

Bad debt expense is an operating expense. An increase in operating expenses decreases income from operations.

When a receivable is no longer collectible as a result of a customer's inability to pay an outstanding debt due to bankruptcy or other financial issues, a bad debt expense is recorded. Companies that offer credit to their customers record bad debts as an allowance for doubtful accounts, also referred to as a provision for credit losses, on their balance sheet.

The basic idea behind bad debt expense is the same as that behind all accounting principles: it enables businesses to completely and accurately report their financial position. Almost every business will encounter a customer who is unable to pay at some point, and they will need to record a bad debt expense.

Learn more about bad debt here:

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2 years ago

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Answer:

a-Dec-31. Dr Utility expense 485

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Explanation:

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2 years ago

Sales revenue$ 4,000Purchases of direct materials$ 400Direct labor$ 450Manufacturing overhead$ 620Operating expenses$ 650Beginni

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Answer:

Direct material used= $420

Explanation:

Giving the following information:

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Purchases of direct materials= $400

Direct labor= $450

Manufacturing overhead= $620

Operating expenses= $650

Beginning raw materials inventory= $200

Ending raw materials inventory= $180

Beginning work in process inventory= $320

Ending work in process inventory= $410

Beginning finished goods inventory= $250

Ending finished goods inventory= $200

Direct material used= ?

Direct material used= beginning inventory raw material + purchase - ending inventory raw material

Direct material used= 200 + 400 - 180= $420

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2 years ago