Accounting for Business

What are the receivables and how to journalise them?

When performing services on an account it is accounts receivable to debit and service revenue to credit, when lending money on a notes receivable, it is notes receivable to debit and cash to credit.

If we collecting receivables from a previous write off, what is the journal entry?

Accounts receivable to debit and allowance of bad debt to credit, cash to debit and accounts receivable to credit.

What are the steps for the end of year balance to journal?

1 - Find receivable balance (start with the beginning accounts receivable then add any receivables to debit and then subtract all receivables to credit).

2 - Find an ending allowance before adjustment (allowance for doubtful accounts minus write off plus money paid back).

3 - Find a portion in $ which is uncollectable (multiply step 1 by percentage and minus step 2).

4 - Create journal entries (debit to bad debt expense, credit to allowance for doubtful accounts).

What are the current assets and liabilities and where do they go?

C - cash

R - receivables

A - accounts payable

I - inventories

N - net income

Minus depreciation expense - Operating section

What are the long term assets and where do they go?

PPE and land - Investing section.

What are the long term liabilities and equity and where do they go?

Notes payable, common stock and dividends paid - Financing section.

What is the ending statement to put on statement of cash flows?

Cash and cash equivalents difference, net change in cash, cash start of year and end of year