Meaning of Other receivables Other receivables generally come with the headings “Trade receivables and others” in the financial statement of large listed public companies. Other receivables are disclosed under the heading “Current Assets” on the balance sheet of the company at the end of the period. These are residual trade or non-trade receivables that have […]
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Overview: A Cash or Sales discount is the reduction in the price of a product or service offered to a customer by the seller to pay the due amount within a specified time period. This is one of the best ways most of the sellers could improve the cash flow for their operations. The
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What Is Sales Return? Sales return is the return of products or commodities by customers to the seller due to many reasons, but usually within some agreed time period and due to the condition of the product and customer satisfaction. This sales return is accounted for differently from the seller and buyer’s perspectives. There may
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Introduction: To know the accounting for bad debts recovered, it is necessary to know what bad debts are and how they arise. When a company supplies goods to a customer or another business on credit, the company has to recognize the same amount of receivables in their books as to the value of sold items.
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Introduction: When a company has a policy of selling goods on credit, a lot of times customers end up not paying the amount they owe to the company. This expense is referred to as a bad debt expense and its treatment and reporting on the financial statements is a bit raveling. The International Accounting Standards
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Revenue: Revenue also referred to as sales or turnover is the total amount of income that a business has earned through the sale of goods or services to the public. According to the matching principle and accrual system of accounting, revenue is recognized or the sale is made when the revenue is earned i.e. earlier
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Bad debt expense: Bad debt expense or doubtful debt expense is an operating expense related to the accounts receivable of the company. It normally happens when the credit customers could not pay off the receivable, then the company already tries their best to recover, yet it could not get any positive results. Then the company
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Revenue recognition: According to IFRS 15, revenue should be recognized when the following criteria are met: When all the risks and rewards associated with the product have been transferred from the seller to the buyer. Control over the goods is transferred to the buyer. The amount of revenue can be reasonably measured. The collection of
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What is a doubtful debt? When a credit customer is expected to go bankrupt or has an unreliable profile, chances are he is going to not pay the amount he owes to us. Such accounts receivable are referred to as doubtful debts or uncollectible invoices. Even though the customer owes us money, we book an
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Accounts receivable is the amount owed to the entity by the customers that have bought goods from the entity on credit i.e. the sale has been made but the payment has not been received yet at the end of the accounting period. Month or year. Even though the payment is not collected, the entity still
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