How do estimates impact the balance sheet? Discuss the advantages and disadvantages.© BrainMass Inc. brainmass.com June 3, 2020, 11:12 pm ad1c9bdddf
Estimates impact the balance sheet components such as accounts receivable. Accounts receivable is one of the major components on the asset side of the balance sheet and is an estimated figure because the amount is yet to be received from debtors. Therefore, there is always a chance that a part of such amount can become bad debt. Usually an allowance for uncollectible accounts is deducted from account receivable. Allowance for uncollectible accounts represents the total amount you do not ...
The solution discusses how do estimates impact the balance sheet.