Читать книгу Wiley GAAP: Financial Statement Disclosure Manual - Joanne M. Flood - Страница 107

Example 7.3: Receivables and Allowances for Doubtful Accounts and Composition of Other Receivables Accounts receivable are presented at net realizable value. The Company maintains allowances for doubtful accounts and for estimated losses. The Company reviews the accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual receivable balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balances, customers' historical payment history, their current credit‐worthiness, and current economic trends. Receivables are considered past due after 180 days. Accounts Receivable are written off against the allowances only after exhaustive collection efforts.

Other receivables represent mainly prepaid employee insurance and welfare benefits, which will be subsequently deducted from the employee payroll, and guarantee deposits on behalf of shipowners as well as office lease deposits.

Example 7.4: Accounts Receivable, Including Amounts of Allowance Accounts Accounts receivable are recorded, net of allowance for doubtful accounts and sales returns. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentration, customer credit worthiness, current economic trends, and changes in customer payment patterns to determine if the allowance for doubtful accounts is adequate. An estimate for doubtful accounts is made when collection of the full amount is no longer probable. Delinquent account balances are written off after management has determined that the likelihood of collection is not probable and known bad debts are written off against the allowance for doubtful accounts when identified. As of August 31, 20X2 and 20X1, the allowance for uncollectible accounts receivable was $829,054, and $1,015,282, respectively.