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Receivables Cheat Sheet

This document outlines the accounting processes for recording accounts receivables and notes receivables. It discusses recognizing accounts and notes receivables, computing interest on notes, collecting accounts through cash or allowing discounts, and estimating allowances for doubtful accounts. Methods covered include direct write-off and allowance methods for uncollectible accounts. The document also addresses honoring, dishonoring, and selling notes receivables.

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Sarah Safira
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171 views

Receivables Cheat Sheet

This document outlines the accounting processes for recording accounts receivables and notes receivables. It discusses recognizing accounts and notes receivables, computing interest on notes, collecting accounts through cash or allowing discounts, and estimating allowances for doubtful accounts. Methods covered include direct write-off and allowance methods for uncollectible accounts. The document also addresses honoring, dishonoring, and selling notes receivables.

Uploaded by

Sarah Safira
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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ACCOUNTS RECEIVABLES NOTES RECEIVABLES

Recognizing Accounts Receivables Computing Interest


Face Value Annual Time in Terms
X X = Interest
(To record sales on account) of Note Interest Rate of One Year
Accounts Receivables
Sales Revenue Recognizing Notes Receivable
(To record merchandice returned) Notes Receivable
Sales Return and Allowances Accounts Receivable
Accounts Receivables
(To record collection of accounts receivables) Disposing of Notes Receivables
Cash HONORED OF NOTES RECEIVABLE
Sales Discounts Cash
Accounts Receivable Notes Receivable
Interest Revenue
Uncollectible Accounts
DIRECT WRITE-OFF METHOD Accrual of Interest Receivable
Bad Debt Expense (Before maturity date)
Accounts Receivable Interest Receivable
Interest Revenue
ALLOWANCE METHOD (At maturity date)
(Recording estimated uncollectibles) Cash
Bad Debt Expense Notes Receivable
Allowance for Doubtful Accounts Interest Receivable
(Recording the write-off of an uncollectible amounts) Interest Revenue
Allowance for Doubtful Accounts
Accounts Receivable DISHONORS OF NOTES RECEIVABLE
(Recovery of an uncollectible account) (Assuming no previous accrual interest)
(1) Accounts Receivable
Accounts Receivable Notes Receivable
Allowance for Doubtful Accounts Interest Revenue
(2)
Cash SALES OF NOTES RECEIVABLES
Accounts Receivable Cash
Service Charge Expense
ESTIMATING THE ALLOWANCE Accounts Receivable
(Percentage-of-sale)
Bad Debt Expense
Allowance for Doubtful Accounts
(Percentage-of-receivables)
Bad Debt Expense
Allowance for Doubtful Accounts

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