Answer:
B) the allowance account and estimates are used.
Explanation:
When a company uses the allowance method, it will record an adjusting entry for the losses it anticipates from bad credits given to customers. The bad debts expense account is debited and the allowance for doubtful accounts (contra asset) is credited. Then as time passes and the amount of bad debts is exactly determined, another adjusting entry is necessary depending whether the estimate was correct or not, or if it was under or over estimated.
Answer:
Explanation: dear customer we are so sorry for the delay of your order we can not find the thing you wanted
Regards
Answer:
$28,800
Explanation:
When a company makes sales on account, debit accounts receivable and credit sales. Based on assessment, some or all of the receivables may be uncollectible.
To account for this, debit bad debit expense and credit allowance for doubtful debt. Should the debt become uncollectible (i.e go bad), debit allowance for doubtful debt and credit accounts receivable.
When the write off is done,
The Accounts Receivable balance = $32,900 - $1,210
= $31,690
Th allowance for doubtful debt account = $4,100 - $1,210
= $2,890
the net realizable value of accounts receivable immediately after the write-off is the difference between the accounts receivable and the allowance for doubtful debt account after writeoff
= $31,690 - $2,890
= $28,800
Answer:
should exceed the rising price level.
Explanation:
Inflation occurs when there is a general increase in prices of goods and services in an economy. The price of a basket of goods increases so the purchasing power of money is reduced.
For example when a gallon of petrol sells for $50 under inflation it can rise to $100. More money will be needed to buy the same amount of goods.
In this situation the rate of return of an investment will need to be above the rising price level to maintain a positive cash flow.
This is because value of money has reduced so returns needs to be higher to make positive cash flow.
