Accounts Receivable has a balance oF $ 33,000, and the Allowance for Bad Debts has a...

Accounts Receivable has a balance oF $ 33,000, and the Allowance for Bad Debts has a credit balance of $3,300. The allowance method is used. What is the net realizable value of Accounts Receivable before and after a $2,200 account receivable is written off?

Expert Solution


	Balance in account receivable account =	$ 33,000

	Balance in allowance for Bad debts account =	$ 3,300

	$ 2,200 account receivable is written off, this amount is reduced from the allowance for bad debts accounts and from Account receivable Also

	So Revise Balance in Allowance for bad debts account is as below,

	Balance in allowance for Bad debts account =	$ 3,300
	Less: Write off	$ 2,200
	Net Balance	$ 1,100


	Balance in account receivable account =	$ 33,000
	Less: Write off	$ 2,200
	Net Revise Balance	$ 30,800

	net realizable value of Accounts Receivable before a $2,200 account receivable is written off

	Balance in account receivable account =	$ 33,000
	Less: Balance in allowance for Bad debts account =	$ 3,300
	Net Balance in account receivable account =	$ 29,700


	net realizable value of Accounts Receivable After a $2,200 account receivable is written off

	Balance in account receivable account =	$ 30,800
	Less: Balance in allowance for Bad debts account =	$ 1,100
	Net Balance in account receivable account =	$ 29,700


	Answer = Net Balance before and after arite off the $ 2,200 is $ 29,700 Only

ekkarill92 answered 2 years ago

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