Pearson Pic

Pearson Pic Study a. Accounts due is coin owed by customers (individuals or corporations) to an a nonher(prenominal)(prenominal) entity in exchange for inexpert goods or proceedss. Receivables come in the form of operating lines of belief and are comm exactly payable in a trivial period of time (days to a year). (2)Trade realization, open narration terms, allot dues, and royalty advancements are other terms used to pull in taradiddles receivable. b. Accounts receivable differs significantly from notes receivable in many ways. Accounts receivable generally do not accrue interest. Accounts receivable is considered a short term debt that is ordinarily paid within 12 months and occurs after receiving a profit or product. Notes receivable is an broad line of opinion and is usually owed for a period inveterate than a year and typically accrues interest. c. A contra account is a subaccount with the opposite normal sleep. For example accumulated depreciation-equipment (asset with a credit normal correspondence). (2) Sales returns and braggy debts are contra accounts of Pearson trade. (3) Managers can forestall the balance of each account by using the plowshare of sales rule. This rule determines the try bad debt loss by applying the percentage to the sale to the sottish of the current period.

Once circumspection estimates the percent they will depend the difference between essential balance and the current balance in the allowance account. d. This option computes doubtful accounts expense by anticipating the percentage of sales (or credit sales) that will eventually drop it to be collected. The percentage of sales rule is sometimes referred to as an income statement approach because the only number being estimated (bad debt expense) appears on the income statement. maturement of Accounts Receivable-is a method similar to Percentage of final exam result Accounts Receivable, but it is a more precise variation. Aging considers that the longer a receivable is outstanding, the less likely it is to be collected. A...If you compulsion to get a full essay, order it on our website: Ordercustompaper.com

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