uncollectible

Examples of uncollectible in the following topics:

• Write-Offs

  • The bad debt is recognized as an expense at the point when judged to be uncollectible.
  • If Smith's USD 750 uncollectible account were recorded in Uncollectible Accounts Expense again, it would be counted as an expense twice.
  • Allowance for uncollectible accounts 3,000 Cr. // 750 Dr. // 2,250 Cr.
  • If the company wrote off any uncollectible accounts during 2009, it would debit Allowance for Uncollectible Accounts and cause a debit balance in that account.
  • At the end of 2009, the company would debit Uncollectible Accounts Expense and credit Allowance for Uncollectible Accounts.

• Valuing Accounts Receivable

  • These uncollectible accounts are called bad debts.
  • Since the specific customer accounts that will become uncollectible are not yet known when the adjusting entry is made, a contra-asset account named allowance for bad debts, which is sometimes called allowance for doubtful accounts, is subtracted from accounts receivable to show the net realizable value of accounts receivable on the balance sheet.

• Recognition of Revenue After Delivery

  • The cost recovery method is used when there is an extremely high probability of uncollectable payments.

• Recognizing Accounts Receivable

  • To calculate the allowance for doubtful accounts using the percentage of total sales, estimate the percentage of sales that will be uncollectible.