Chap 15

Question 1

Aging the Accounts Receivable

Answer 1

classifying accounts receivable balances according to how long they have been outstanding (ex: 1-30 days, 31-60 days, 61-90 days)

Question 2

Allowance Method

Answer 2

a method of recording uncollectible accounts that estimates losses from uncollectible accounts and charges them to expenses in the period when the sales are recorded.

Opposite of Direct Charge Off Method.

Question 3

Direct Charge-Off Method

Answer 3

a method if recording uncollectible account losses as they occur

Question 4

Valuation Account

Answer 4

an account whose balance is revalued or reappraised in light of reasonable expectations. Ex: “allowance for doubtful accounts”