Accounts receivable (or commerce receivable) are amounts owed by a firm's customers in return of purchasing on credit. Monetary transactions such as granting of loans additionally generate more receivables. For example, most of the receivables on banks' balance sheets are interest receivable and loans receivable. Receivables are assets of a firm because it expects to convert them into cash in the near future, with a high degree of chance.
This case describes how to account for receivables. The reader will learn the allowance way of receivables that are uncollectible and the way to record value added tax. The case covers notions such as bad debt expenses, allowance for bad debt, write offs, recoveries and the aging evaluation for the approximation of bad debts.
PUBLICATION DATE: May 02, 2016 PRODUCT #: IES532-PDF-ENG
This is just an excerpt. This case is about FINANCE & ACCOUNTING
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