Accounts receivable are valued and reported on the statement of financial position
A)in the non-current asset section.
B)at the gross amount less sales returns and allowances.
C)at net realizable value.
D)only if they are not past due.

Question

Quizplus · Accepted Answer

Accounts receivable are reported at their net realizable value, which is the gross amount less any allowance for doubtful accounts or bad debts. This is because not all accounts receivable may be collected, and therefore the statement of financial position should reflect the estimated amount that will actually be received. Choices A, B, and D are not correct because accounts receivable are current assets and are not reported in the non-current asset section, they are reported net of sales returns and allowances, and they are still reported even if they are past due.

Accounts Receivable Are Valued and Reported on the Statement of Financial