| A | B |
|---|
| Uncollectible Accounts | An account receivable that the business cannot collect; also called a bad debt. |
| Direct write-off method | The business removes the uncollectible account from its accounting records when it determines the amount is not going to be paid. |
| Allowance method | The business matches the estimated uncollectible account expense with the sales made during the same period. |
| Book value of accounts receivable | - The amount the business can reasonable expect to collect from its accounts receivable. |
| Percentage of net sales method | A method of estimating uncollectible accounts expense in which a business assumes that a certain percentage of each year’s net sales will be uncollectible. |
| Aging of Accounts Receivable Method | A method of estimating the uncollectible accounts expense in which each customer’s account is classified by age; the age classifications are multiplied by certain percentages; and the total estimated uncollectible amounts are added to determine the end-of-period balance of Allowance for Uncollectible Accounts. |
| Accounts Receivable | The total amount of money owed to a business. |
| Accounts Receivable Subsidiary Ledger | A separate ledger that contains accounts for all charge customers; it is summarized in the Accounts Receivable controlling account in the general ledger. |
| Assets | Property or items of value owned by the business. |
| Balance Sheet | A report of the balances in all asset, liabilty, and owner's equtiy accounts at the end of the period. |
| Charge Customer | A customer to whom a sale on account is made. |
| Computerized Accounting System | A system in which financial information is recorded by entering it into a computer. |
