The difference between the balance of Accounts Receivable and its contra account, Allowance for Uncollectible Accounts

The difference between an asset's account balance and its related contra account

A written and signed promise to pay a sum of money at a specified time

A promissory note signed by a business and given to a creditor

A promissory note that a business accepts from a customer

The person or business that signs a note and thus promises to make payment

The person or business to whom the amount of a note is payable

The allowance method for uncollectible accounts complies with GAAP

What is the normal balance of the account Allowance for Uncollectible Accounts?

What is the normal balance of the account Uncollectible Accounts Expense?

Interest rates are stated as a percentage of the ____________.

The amount of accounts receivable a business expects to collect

A method used to estimate uncollectible accounts receivable that assumes a percent of credit sales will become uncollectible

A method that uses an analysis of accounts receivable to estimate the amount that will be uncollectible

Analyzing accounts receivable according to when they are due

Which accounting concept is applied when the process of making accounting estimates is free from bias

When a customer account is written off under the allowance method, the book value of accounts receivable decreases

When a customer's account is written off, the business should stop trying to collect the payment from them

A note provides a business with legal evidence of debt in case they have to take the customer to court

The direct write-off method complies with GAAP

The book value of accounts receivable must be a reasonable and unbiased estimate of the money the business expects to collect in the future

A note that is not paid when due

The interest earned on money loaned

The amount that is due on the maturity date of a note

The original amount of a note, sometimes called the "face value"

Abbreviation for notes receivable

Total assets are reduced when a business accepts a note receivable from a customer needing an extension

Interest income is classified as revenue from normal operations

Allowance for Uncollectible Accounts is not reported on the income statement

Canceling the balance of a customer account because the customer does not pay

Businesses should always let their customers know if their account has been written off

The percentage of the principal that is due for the use of funds secured by a note

Interest = principal X interest rate X ________________

The date on which the principal of a note is due to be repaid

The length of time from the signing date of a note to the maturity date, also called the "term"

When using the allowance method, writing off an uncollectible account does not change the net realizable value of accounts receivable

A business usually knows at the end of the fiscal year which customer accounts will become uncollectible

The adjusting entry for uncollectible accounts changes the balance of the Accounts Receivable account

The percent of each age group of an accounts receivable aging that is expected to become uncollectible is determined by the business's past experiences and economic conditions