Define “accounts receivable.”
How is the “net realizable value” of accounts receivable determined?
. Name three factors a company might consider when trying to determine the amount of accounts receivable that will be ultimately collected.
What does the account “allowance for doubtful accounts” represent?
. Define “contra account.
” . When is bad debt expense recorded?
. Why do companies set up the allowance for doubtful accounts instead of just decreasing accounts receivable for any expected uncollectible balances?