BUS 251 Lecture Notes - Lecture 7: Accounts Receivable, Quick Ratio, Bank Statement

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 251
• Professor: Anne Mcdonald

Document Summary

A/ are a(cid:373)ou(cid:374)ts o(cid:449)ed to a (cid:272)o(cid:373)pa(cid:374)(cid:455) fro(cid:373) (cid:272)redit sales to (cid:272)usto(cid:373)ers of the (cid:272)o(cid:373)pa(cid:374)(cid:455)(cid:859)s normal business transactions: accounts receivable. Uncertainties about cash collection affect both the i/s and the b/s. There is possible overstatement of revenues and a/r. We create 2 new accounts to deal with the problem: accounts receivable. Be clear about the difference in behavior between afda and the bad debts expense. The afda is a permanent (b/s) account: accounts receivable. Cr allowance for doubtful accounts (afda) (xa : accounts receivable, accounts receivable, accounts receivable, accounts receivable, accounts receivable, accounts receivable. The co(cid:373)pa(cid:374)(cid:455) trades o(cid:374)l(cid:455) (cid:449)ith re(cid:272)og(cid:374)ized, (cid:272)redit(cid:449)orth(cid:455) third parties. It is the co(cid:373)pa(cid:374)(cid:455)(cid:859)s poli(cid:272)(cid:455) that all customers who wish to trade on credit terms are subject to credit verification procedures. Policies and procedures to ensure: the protection of assets from theft, loss or inappropriate use. the reliability of the accounting information system: cash.