Fundamentals of Accounting Accounts Receivable

A customer notifies the vendor that purchased merchandise is damaged and cannot be sold at normal price. Any credit granted to the customer would be called a

• sales return

• purchase allowance

• sales allowance

• purchase return

Things owned by a company

• liablities
• profit
• assets
• loss

Net worth of a business

• balance sheet
• financial statement
• Income statement
• Owners Equity

A formal examination of a company's financial records

• Fiscal Period
• budget
• audit
• revenue

Some businesses refer to uncollectible accounts as __.

• cliff hangers

• bad debts

• unpaid debts

• uncollectible debts

When an account becomes uncollectible and must be written off,

• Bad Debt Expense should be credited.

• Allowance for Doubtful Accounts should be credited.

• Sales Revenue should be debited.

• Accounts Receivable should be credited.

Two methods of accounting for uncollectible accounts are the

• allowance method and the accrual method.

• direct write-off method and the accrual method.

• direct write-off method and the allowance method.

• allowance method and the net realizable method.

bill to the customer after a transfer of goods or the completion of services which represents a financial transaction between the buyer and is usually payable at a later date

• sales invoice

• receipt

• memorandum

• check

how much cash (cash flow) a business generates from it's core business operations - selling products or services

• Operating Activities

• Financing Activities

• Investing Activities

a means of tracking all invoices and payments from customers

• invoice

• customer file

• bank statement