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    student007's Avatar
    student007 Posts: 60, Reputation: 2
    Junior Member
    		  
    #1

    Sep 19, 2006, 10:59 AM
    net vs. gross a/r
    In a company's financial statements, what is usually shown in the a/r account? Net or gross a/r? If the a/r is broken down, and a note says the company uses 2.5% allowance for bad accounts based on a/r, but no allowance account is explicitly shown, do you assume that the values you see are net, or gross a/r? Also, if they are net a/r, then would gross a/r be equal to:

    net a/r = (net a/r) / 0.0975

    Thx
    CaptainForest's Avatar
    CaptainForest Posts: 3,645, Reputation: 393
    Ultra Member
    		  
    #2

    Sep 19, 2006, 03:09 PM
    Balance Sheet

    Cash 100
    Accounts Receivable 90
    Less: AFDA 30
    Net AR 60

    If it just says AR 60 and you KNOW there is an AFDA, then the 60 is the NET amount.
    student007's Avatar
    student007 Posts: 60, Reputation: 2
    Junior Member
    		  
    #3

    Sep 19, 2006, 07:33 PM
    Thanks
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