1.After the accounts are adjusted and closed at the end of the fiscal year, Acco
ID: 2592527 • Letter: 1
Question
1.After the accounts are adjusted and closed at the end of the fiscal year, Accounts Receivable has a balance of $340,000 and Allowance for Doubtful Accounts has a balance of $51,000. What is the net realizable value of accounts receivable?
3.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 uncollectible. The entry to write off this account would be
a.debit Bad Debt Expense; credit Allowance for Doubtful Accounts
b.debit Accounts Receivable; credit Notes Receivable
c.debit Allowance for Doubtful Accounts; credit Accounts Receivable
d.debit Bad Debt Expense; credit Accounts Receivable
Explanation / Answer
1.net realizable value of accounts receivable is $ 2,89,000
2. Debit Bad debt expenses Credit Accounts Receivable since the company is using direct writtoff methis they will be provision for bad debts will be created