Question

Identify any errors in the following partial balance sheet. The interest receivable should be ____________________________________. The allowance for doubtful accounts should be ____________________________________.
WORD BANK
- added to the notes receivable
- deducted from accounts receivable
- reported separately as a current asset
- shown on the income statement as revenue

Answer 1

The interest receivable should be reported separately as a current asset. The allowance for doubtful accounts should be deducted from accounts receivable.