Business, Legal & Accounting Glossary
An estimate of the risk of not collecting full payment from credit customers, reported as a deduction from trade receivables (debtors) in the balance sheet.
The actual amount of noncollectable receivable is written off as an expense from the provision for doubtful accounts.
They are increasing by £2.5 million their allowance for doubtful accounts to £3.7 million.
The portion of the account receivable that is estimated to be non collectable is set aside in a contra-asset account called “Provision for doubtful debts”.
On 29th March, 2018, the company announced an adjustment related to an increase in the estimate for its provision for doubtful accounts and a restatement for a change in revenue recognition method for its culinary and healthcare internships.
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This glossary post was last updated: 10th August, 2019 | 12 Views.