1. FINANCIAL ACCOUNTING-BUS 020- SPRING 2015 Session 12 Accounts Receivable

2. FINANCIAL ACCOUNTING-BUS 020- SPRING 2015 Basic Sales Transaction n Receivables n Cash

3. FINANCIAL ACCOUNTING-BUS 020- SPRING 2015 Sales Discounts and Returns n Early payment incentive n 2/10, net/30 n Returns and allowances n Net sales  gross sales

4. FINANCIAL ACCOUNTING-BUS 020- SPRING 2015 Accounts Receivable n Customer IOU’s n Current versus non-current n Trade versus non-trade n Remember C-D-E-F n Net realizable value

5. FINANCIAL ACCOUNTING-BUS 020- SPRING 2015 Allowance for Doubtful Accounts n Contra account n Estimate and expense n Bad debt expense n Variety of ways to estimate allowance n Write off when certain

6. Sales of A/R n Cash xx n Fees xx n A/R xx FINANCIAL ACCOUNTING-BUS 020- SPRING 2015

7. Notes Receivable n Preference n Recording n Interest accrual n Payment FINANCIAL ACCOUNTING-BUS 020- SPRING 2015

8. Presentation & Analysis n Contra Account presentation n Key Metrics n Days Sales Outstanding (DSO) n A/R Turnover n Let’s Practice n Do It (p. 399) n E 8-3; 8-6; 8-14; and P 8-1A FINANCIAL ACCOUNTING-BUS 020- SPRING 2015

9. Gross Margin (Profit) Percentage n Analytical importance

10. FINANCIAL ACCOUNTING-BUS 020- SPRING 2015 Analyzing A/R n Aging n DSO…days sales outstanding n A/R turns n Disaggregation by geographic venue and operating segments n Impact on cash flows