Answer: The answer is $93,000
Explanation: From the question above, we have:
Ending balance in the accounts receivable account = $100,000
Prime recorded bad debt expense = $3,000
Allowance for uncollectible accounts = $7,000
The net realizable value of accounts receivable is calculated as:
accounts receivable balance - allowance for uncollectible accounts
Therefore we have:
$100,000 - $7,000 = $93,000
The bad debt expenses have been debited already, therefore, they are no longer part of the allowance for uncollectible accounts.
Answer:
$93,000
Explanation:
Bad debt is a customers account that is written off as it can not be collected due to reasons like insolvency or other financial crisis suffered by the customer , while the allowance for uncollectible accounts is just allowing possibility of future non payments. estimates are made and recorded in the current year.
Receivable balance = $100,000
Bad debt Expense = $100,000
Allowance for Uncollectible accounts = $7000
Net account receivable balance = $(100,000-7000) =$93,000
