Use the following information for questions. The following accounts were included on Stacy's Style Consultants Post-Closing Trial Balance at December 31, 2008: Accounts Payable 2,000 Accounts Receivable 5,500 Cash 11,000 Stacy Capital Stacy Drawing Interest Expense 40,000 10,000 3,000 Note Payable, due 8/31/11 Supplies 60,000 1,000 Service Revenue 39,000 Equipment 5,000 What are the total current assets? (Answer Guide: No Peso Sign, No Decimal Point) What are total current liabilities?
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.
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