Assume a company has an accounts receivable balance from a customer totalling $41,000. Based on...
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Assume a company has an accounts receivable balance from a customer totalling $41,000. Based on an analysis of the risk, timing and, expected cash flows, the company comes up with the following estimates at the respective reporting dates: 31 December 20X7: The company expects to be able to collect $26,000 from the customer. 31 March 20X8: The receivable has still not been collected, and the company expects they will only be able to collect $18,000. Required:
Prepare the adjusting entry to record the lifetime expected credit losses for this customer on 31 December 20X7:
Prepare the adjusting entry to record the lifetime expected credit losses for this customer on 31 March 20X8:
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