acc chap 8

The Lowery Co. uses the direct write-off method of accounting for uncollectible accounts receivable. Lowery has a customer whose accounts receivable balance has been determined to likely be uncollecttible. The entry to write off this account would be which of the following?:

debit bad debt expense; credit accounts receivable

If the allowance method of accounting for uncollectible receivables is used, what general ledger account is credited to write off a customer's account as uncollectible?

accounts receivable

The two methods of accounting for uncollectible receivables are the allowance method and the

direct write-off method

The term "receivables" includes all

money claims against other entities

An alternative name for Bad Debts Expense is

uncollectible accounts expense

One of the weaknesses of the direct write-off method is that it

violates the matching principle

After the accounts are adjusted and closed at the end of the fiscal year, Accounts Receivable has a balance of $460,000 and Allowance for Doubtful Accounts has a balance of $30,000. What is the net realizable value of the accounts receivable?

$430,000

When does an account become uncollectible?

there is no general rule for when an account becomes uncollectible

Notes or accounts receivables that result from sales transactions are often called

trade recievables