In Reviewing the Accounts Receivable, the Cash Realizable Value Is

question 43

Multiple Choice

In reviewing the accounts receivable, the cash realizable value is $16,000 before the write-off of a $1,500 account. What is the cash realizable value after the write-off?

• A) $1,500
• B) $14,500
• C) $16,000
• D) $17,500

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Definitions:

Accrued Revenue

Income earned but not yet received, typically recorded with an adjusting journal entry.

Prepaid Expense

Prepaid expense refers to payments made in advance for goods or services to be received in the future, recognized as assets on a balance sheet.

Unearned Service Revenue

Income received in advance for services that have not yet been performed, considered a liability until the service is delivered.

Adjusting Entries

Adjustments in accounting records at the end of a period to correctly distribute incomes and costs to the period they pertain to.