The struggle to manage Accounts Receivable Purchase Agreement can consume your time and overwhelm you. But no more - DocHub is here to take the effort out of altering and completing your papers. You can forget about spending hours adjusting, signing, and organizing papers and worrying about data safety. Our solution offers industry-leading data protection procedures, so you don’t need to think twice about trusting us with your privat info.
DocHub supports various data file formats and is accessible across multiple platforms.
Hi. Else here. And in this video will be exploring the valuation of accounts receivable at period end using the allowance method. In my last video, I talked about the direct write off method and how we generally cant use it because it violates both expense and asset elements. I asked, what method can we use so our assets are appropriately valued in 2014 and we record our bad debt expense in 2014, the same year as the related revenue? That would allow us to follow the definition of both the element assets, which need to be valued at their future economic benefit, and the element expense, which have to be recorded in the same period as the related revenue. I called it the allowance method. Lets look at how it works. Lets assume were back at December 31, 2014. Our accounts receivable are $360,000 on the balance sheet. We know that when we sell on credit there will always be a problem with collections. Some of our customers will never pay. The more we sell on credit, the greater the ri
