Question

In reviewing the accounts receivable, the cash realizable value is $15990 before the write-off of a $1510 account. What is the cash realizable value after the write-off

Answer 1

Answer: $15,990

Step-by-step explanation:

It is always assumed that a company uses the Allowance method for uncollectibles unless otherwise stated. This means that when there is a write-off, it will come out of the allowance for uncollectible accounts.

As the allowance balance has already been deducted from the accounts receivable to find the receivables' cash realizable value, the accounts receivable balance will not change even after the write-off.