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A firm has a days sales outstanding of 40 days and its annual sales are 7300000 what is the accounts receivable balance?
For calculating accounts receivable balance we need accounts receivable turnover rate So Accounts receivable turnover rate = number of days in year/annual sales outstanding accounts receivable turnover rate = 360/40 = 9 Accounts receivable balance = 7300000/9 Accounts receivable balance = 811111
What is the difference for account receivable and accounts payable?
When company make sales in credit it creates the accounts receivable while when company purchases on credit it creates the accounts payable so accounts receivable is current asset while accounts payable is current liability.
What purpose does the schedule of account receivable serve?
Schedule of accounts receivable helps the management to find out which customer has not paid for longer period of time so that focused efforts should be put toward that customer for recovery of amount.
Why is account receivable important?
it is so important for the business...Accounts receivables are the money that is owed to a business, accounts payables are the invoices or bills that a company has incurred and must pay to their vendors or suppliers. A/R Accounts...an Accounts Receivable is a file with a person's name or a Company's name that owes money to you or to another company eg: John Doe ordered 20 books from my bookstore, because he has an account...
Is accounts receivable a financing activity?
no it is an operating activity since accounts receivable are the person who has to give us the money and the mmoney is from sales so it in an operating activity.
A firm has a days sales outstanding of 40 days and its annual sales are 7300000 what is the accounts receivable balance?
For calculating accounts receivable balance we need accounts receivable turnover rate So Accounts receivable turnover rate = number of days in year/annual sales outstanding accounts receivable turnover rate = 360/40 = 9 Accounts receivable balance = 7300000/9 Accounts receivable balance = 811111
What is the difference for account receivable and accounts payable?
When company make sales in credit it creates the accounts receivable while when company purchases on credit it creates the accounts payable so accounts receivable is current asset while accounts payable is current liability.
Can accounts receivable normally have a debit balance?
Accounts receivable in an asset account and normally maintains a debit balance. So the answer is Yes.
What purpose does the schedule of account receivable serve?
Schedule of accounts receivable helps the management to find out which customer has not paid for longer period of time so that focused efforts should be put toward that customer for recovery of amount.
Why is account receivable important?
it is so important for the business...Accounts receivables are the money that is owed to a business, accounts payables are the invoices or bills that a company has incurred and must pay to their vendors or suppliers. A/R Accounts...an Accounts Receivable is a file with a person's name or a Company's name that owes money to you or to another company eg: John Doe ordered 20 books from my bookstore, because he has an account...
Is accounts receivable a financing activity?
no it is an operating activity since accounts receivable are the person who has to give us the money and the mmoney is from sales so it in an operating activity.
Double entry on accounts receivable?
As an asset account, the accounts receivable (Sales Ledger Control) build up the debit side. So: First off, sales are credited the amount then the receivable account is debited the same amount. Once payment has been made then accounts receivable is credited and the bank is debited.
What is rentention on an Account receivable aging?
An accounts receivable aging report summarizes your receivables on their age - how long they have been outstanding. So all the unpaid invoices posted in the past month are current, all the unpaid...The accounts receivable aging schedule is a listing of the customers making up your total accounts receivable balance.
What to debit after increasinf accounts receivable?
the debit will be to the accounts receivable because a debit increases it. the offset account in this entry is usually a revenue account. so therefore a credit to revenue.
Is accounts receivable classified as a liabilities and equity on a balance sheet?
Account receivable is that part of sales which are done on credit so if company received cash at the time of sales that would be asset as well so it is the amount which is receivable in future so it is current asset of company.
Is accounts receivable included in sales?
There are two kinds of sales, one is cash sales and other once is credit sales. Whenever sales are made on credit it will create accounts receivable which will be shown in balance sheet as current asset. So it means that accounts receivables are created due to credit sales so it is already included in sales So; Total Sales = Cash Sales + Credit Sales (Accounts Receivable)
Which normally has a credit balance - accounts receivable or notes payable?
Notes Payable is a liability, so it would normally have a credit balance. Accounts Receivable is an asset which would normally have a debit balance.
