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Why is it necessary to account for dubious accounts in receivables accounting? Is it really necessary? Give an explanation for your response. Please explain exact answer

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter9: Accounting For Receivables

Section: Chapter Questions

Problem 9MC: Which method delays recognition of bad debt until the specific customer accounts receivable is...

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Concept explainers

Bookkeeping

Bookkeeping is the process of recording the financial transactions of a company on a regular basis. With the process of bookkeeping, companies can track important financial information that helps management in making crucial decisions.

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Why is it necessary to account for dubious accounts in receivables accounting? Is it really necessary? Give an explanation for your response.

Please explain exact answer

Definition Definition Money that the business will be receiving from its clients who have utilized the credit provided to buy its goods and services. The credit period typically lasts for a short term, lasting from a few days, a few months, to a year.

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Which account type is used to record bad debt estimation and is a contra account to Accounts Receivable?
Which method delays recognition of bad debt until the specific customer accounts receivable is identified? A. income statement method B. balance sheet method C. direct write-off method D. allowance method
What should be done if differences are found between the bank statement and the book account?
Why do we need to provide allowance for doubtful accounts in accounting for receivables? Is it necessary? Explain your answer.
Which one of the following is not an accounting problem (issue) associated with accounts receivable? Group of answer choices Recognizing accounts receivable Depreciating accounts receivable Reporting accounts receivable Relieving accounts receivable
what basic accounting principle is the basis for criticizing the direct charge off method for recording uncollectible accounts?
How should we account for the fact that not every account receivable is likely to be collected?
Which statement is false? a. The amount of Accounts Receivable pledged should be excluded from Accounts Receivable in the balance sheet. b. When Accounts Receivable are assigned on a notification basis, the company reduces liability and Accounts Receivable account for the net amount of collections of Accounts Rceivable. c. In factoring Accounts Receivable as a continuing agreement, the buyer of Accounts Receivable protects himself from risks arising from discounts, returns and allowances thru by withholding a portion of the amount of accounts receivable. e. none of the above Please explain.