Applying the direct write-off method to account for uncollectibles Shawm Valley is an attorney in Los Angeles. Valley uses the direct write-off method to account for uncollectible receivables. On April 30, 2018, Valley’s accounts receivable totaled $1 9,000. During May, she revenue of $22,000 on the account and collected $15,000 on the account. She also wrote off uncollectible receivables of $1,100 on May 31, 2018. Requirements Use the direct write-off method to journalize Valley’s write-off of the uncollectible receivables. What is Valley’s balance of Accounts Receivable on May 31, 2018?
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Applying the direct write-off method to account for uncollectibles
Shawm Valley is an attorney in Los Angeles. Valley uses the direct write-off method to account for uncollectible receivables.
On April 30, 2018, Valley’s accounts receivable totaled $1 9,000. During May, she revenue of $22,000 on the account and collected $15,000 on the account. She also wrote off uncollectible receivables of $1,100 on May 31, 2018.
Requirements
- Use the direct write-off method to journalize Valley’s write-off of the uncollectible receivables.
- What is Valley’s balance of Accounts Receivable on May 31, 2018?
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
