What Are the Two Methods of Accounting for Uncollectible Accounts

question 78

Essay

What are the two methods of accounting for uncollectible accounts?

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Definitions:

Account Payable

The liability created by a purchase on account.

Credit Balance

A situation where the sum of credits in an account exceeds the sum of debits, often indicating a liability or revenue.

Cash Short

Cash Short refers to a situation where the actual amount of cash on hand is less than the recorded amount in the accounting records, indicating a discrepancy that needs investigation.

Cash Overages

A situation where the amount of cash in a cash register exceeds the amount expected based on sales records and receipts.