Ch. 9 Acct

Trade accounts receivable are valued and reported on the balance sheet

at net realizable value.

The term "receivables" refers to

amounts due from individuals or companies.

Bad Debt Expense is reported on the income statement as

an operating expense.

To record estimated uncollectible accounts using the allowance method, the adjusting entry would be a

debit to Bad Debt Expense and a credit to Allowance for Doubtful Accounts.

When an account is written off using the allowance method, accounts receivable

decreases and the allowance account decreases.

The balance of Allowance for Doubtful Accounts prior to making the adjusting entry to record estimated uncollectible accounts

is relevant when using the percentage of receivables basis.

The receivable that is usually evidenced by a formal instrument of credit is a(n)

note receivable.

Interest is usually associated with

notes receivable.

A seller may encourage early payment by

offering a discount for early payment.

The method of accounting for uncollectible accounts that results in a better matching of expenses with revenues is the

percentage of sales method.