The General Ledger Account for Accounts Receivable Shows a Debit

question 30

Essay

The general ledger account for Accounts Receivable shows a debit balance of $40,000.The Allowance for Uncollectible Accounts has a credit balance of $2,000.Net sales for the year were $250,000.In the past,3 percent of net sales have proved uncollectible.An aging of accounts receivable accounts results in an estimate of $9,000 of uncollectible accounts receivable.Calculate (a)Uncollectible Accounts Expense and (b)the ending balance of the Allowance for Uncollectible Accounts using (i)the percentage of net sales method and (ii)the accounts receivable aging method.

---

Definitions:

Federal Government

The national government of a country, responsible for governing the entire nation and making decisions on federal matters.

Compensation Strategy

An organization’s approach to determining how to reward employees, incorporating elements such as pay levels, benefits, incentives, and performance evaluations.

Affordability

The degree to which something is financially viable or within one's financial means, often used in reference to budgeting and financial planning.

Legality

The state or condition of being in accordance with the law.