ts Accounts Receivable at December 31, 2020 and determined that the estimated uncollectibles on that date was P85,200. During 2020, some customers’ accounts were written off. Additional information is available as follows: Allowance for Bad Debts, December 31, 2019- P63,000 Bad debts expense reported in 2020 profit or loss- P18,000 Accounts Receivable, December 31, 2020- P607,500 Uncollectible accounts recovery during 2020- P12,000 How much were the accounts written off during 2020?
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
J-Hope Company prepared an aging of its
- Allowance for
Bad Debts , December 31, 2019- P63,000 - Bad debts expense reported in 2020 profit or loss- P18,000
- Accounts Receivable, December 31, 2020- P607,500
- Uncollectible accounts recovery during 2020- P12,000
How much were the accounts written off during 2020?
A P18,000
B P6,000
C P22,200
D P7,800
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