UNCOLLECTIBLE ACCOUNT EXPENSE Definition

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UNCOLLECTIBLE ACCOUNT EXPENSE, also known as a bad-debt expense, is that expense incurred in the unsuccessful attempt to realize payment of a Account Receivable. Uncollectible account expenses must be incurred in the time period in which the related sales are made, e.g. an AR that originates from a credit sale in January and is determined to be uncollectible in June represents an expense in January.

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TOP-LINE of a company is its gross sales, or revenue figure.

PROFIT MARGIN ON SALES is: a. Gross Profit Margin on Sales = Gross Profit/Sales * 100; or, b. Net Profit Margin on Sales = Net Profit After Tax/Sales * 100. See also GROSS PROFIT MARGIN ON SALES.

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