Mastering Accounts Receivable and Notes Receivable: Comprehensive Guide to Valuation, Recording, and Control
Sub Category
- Accounting & Bookkeeping
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Objectives
- Define accounts receivable and notes receivable, their nature as assets, and representing money owed for goods or services provided on credit.
- Explain accounts receivable cycle, including recording, monitoring, and collecting accounts receivable, and importance of subsidiary ledgers.
- Analyze valuation methods for accounts receivable: allowance method and direct write-off method, considering financial statements and matching principle.
- Apply allowance method to estimate bad debt expense based on historical data, industry norms, and economic conditions.
- Compare allowance method and direct write-off method, considering advantages, limitations, and financial reporting implications.
- Describe components of a note receivable and record related journal entries.
- Calculate simple interest on notes receivable using appropriate formulas.
- Interpret financial impact of accounts receivable and notes receivable on balance sheet and income statement.
- Analyze control measures for effective management of accounts receivable, including credit policies and collection strategies.
- Evaluate implications of accounts receivable and notes receivable on financial analysis and decision-making processes.
Pre Requisites
- Basic understanding of accounting principles and concepts: Students should have knowledge of fundamental accounting concepts such as debits and credits, the accounting equation, and the basic financial statements.
- Familiarity with financial statements and the accounting equation: Students should be able to analyze financial statements, understand their components (such as assets, liabilities, and equity), and grasp how transactions affect the accounting equation.
- Proficiency in mathematical calculations: Students should be comfortable performing mathematical calculations, including addition, subtraction, multiplication, and division. Basic knowledge of percentages and ratios is also beneficial.
- Knowledge of journal entries and posting: Students should understand the concept of journal entries and how to record them in the appropriate accounts. Knowledge of the chart of accounts and the posting process is essential.
FAQ
- Q. How long do I have access to the course materials?
- A. You can view and review the lecture materials indefinitely, like an on-demand channel.
- Q. Can I take my courses with me wherever I go?
- A. Definitely! If you have an internet connection, courses on Udemy are available on any device at any time. If you don't have an internet connection, some instructors also let their students download course lectures. That's up to the instructor though, so make sure you get on their good side!
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