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21 August, 10:02

On January 1, 2016, the Accounts Receivable balance was $28,100 and the balance in the Allowance for Doubtful Accounts was $3,200. On January 15, 2016 an $940 uncollectible account was written-off. The net realizable value of accounts receivable immediately after the write-off is:

a) $27,160.

b) $23,960.

c) $24,900.

d) $25,840.

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  1. 21 August, 13:17
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    Net Accounts receivable = $24900

    so correct option is c) $24,900

    Explanation:

    given data

    Accounts Receivable balance = $28,100

    Doubtful Accounts = $3,200

    uncollectible account = $940

    to find out

    net realizable value of accounts receivable immediately

    solution

    we get here first Accounts receivable that is

    Accounts receivable = Accounts Receivable balance - uncollectible account ... 1

    Accounts receivable = $28,100 - $940

    Accounts receivable = $27160

    and

    allowance will be here

    allowance = Doubtful Accounts - uncollectible account ... 2

    allowance = $3,200 - $940

    allowance = $2260

    so Net Accounts receivable is

    Net Accounts receivable = $27160 - $2260

    Net Accounts receivable = $24900

    so correct option is c) $24,900
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