Mission Statement

The Rant's mission is to offer information that is useful in business administration, economics, finance, accounting, and everyday life. The mission of the People of God is to be salt of the earth and light of the world. This people is "a most sure seed of unity, hope, and salvation for the whole human race." Its destiny "is the Kingdom of God which has been begun by God himself on earth and which must be further extended until it has been brought to perfection by him at the end of time."

Monday, May 6, 2024

Accounting: The Language of Business - Vol. 2 (Intermediate: Part 143)


  • Leviticus 19:35-36
    "Just scales, just weights, just dry measures, and just liquid measures you shall have"

Short-Term Operating Assets: Cash and Receivables (Part H)

by

Charles Lamson


Subsequent Receivables


A company writes off an account receivable when it no longer expects to collect the amount due from a customer. However, the customer legally still owes money to the company and may eventually pay the amount due. A recovery occurs when a company receives payment on an account that it had previously written off. There are two steps to account for the subsequent recovery of accounts previously written off against the allowance account:


  1. Reinstate the account receivable and restore the allowance account. 

  2. Record the cash collection. 


Example 9.8 illustrates accounting for the recovery of a write-off.





*GORDON, RAEDY, SANNELLA, 2019, INTERMEDIATE ACCOUNTING, 2ND ED., PP. 456-458*


end

No comments:

Post a Comment