I need help in determining the net realizable value of accounts receivable: A/R

Question

I need help in determining the net realizable value of accounts receivable:

A/R debit balance of $2,786,000
Allowance for doubtful accounts credit balance of 163,000
Sales revenue of $14,827,000

I have computed $118,616 as the bad debt expense using the percentage of sales method. How would I compute the net realizable value of accounts receivable if there are also three non collectible accounts equaling $127,000.

I have come up with a few figures and am stuck on how to compute this correctly.

thank you.

Explanation / Answer

So the allowance is 118616. If there are already 3 uncollectible accounts, we will subtract that amount. 118616-127000=-(8384) which means a further 8384 will be written off

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