Chapter 8 Flashcards
1
Q
Samuel, Inc has Accounts Receivable of $200,000 and an Allowance for Doubtful Accounts of $10,000. If it writes-off a $1,000 account, its net accounts receivable is:
A
$190,000.
Feedback: After the write-off, its Accounts Receivable is $199,000 ($200,000-$1,000); and its Allowance for Doubtful Accounts is $9,000 ($10,000 - $1,000). Thus, its net accounts receivable is $190,000 ($199,000 - $9,000). Notice that the net accounts receivable after a write-off is the same as the net amount before the write-off ($200,000 - $10,000)
