How to prepare a partial balance sheet for a company from the following information:
Cash-$10,000
Account Receivable-$6000
Bad Debts Expense-$1,400
Merchandise Inventory-$1,800
Allowance for Doubtful Accounts-$200
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How to prepare a partial balance sheet for a company from the following information:
Cash-$10,000
Account Receivable-$6000
Bad Debts Expense-$1,400
Merchandise Inventory-$1,800
Allowance for Doubtful Accounts-$200
Ignore bad debts expense as it is an item for Income statement. For a partial balance sheet, you need to project the available information. In this case it is current assets.
[QUOTE=rehmanvohra;3580072]Ignore bad debts expense as it is an item for Income statement. For a partial balance sheet, you need to project the available information. In this case it is current assets.
Thank you
Company had a balance in Accounts Receivable of $22,300. Net credit sales for the year were $515,000. The Allowance for Doubtful Accounts has a debit balance of $615. How do you journalize the recording of the bad debt expense under the balance sheet approach if $1,510 is the estimated amount of uncollectible accounts?
The formula is:
Required balance 1510
+ Opening debit balance 615
Total expense 2125
Note:
(a) If opening balance is credit then you deduct from required balance.
(b) If there is any write offs, you must add to required balance
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