October 30, 2016 admin

Allowance for Doubtful Ford Receivables

Assets

ALLOWANCE FOR DOUBTFUL FORD RECEIVABLES ASSET ACCOUNT
1291

ACCOUNT EXPLANATION
Allowance for loss from uncollectible Ford Receivables, excluding Ford Warranty and Policy receivables.
TRANSACTIONS
  Jrnl. Dr. Cr.
  Monthly adjustment of allowance for doubtful Ford Receivable SE
    Applicable Cost of Sale Accounts 4400-etc.
      Allowance for Doubtful Ford Receivable 1291
             
  Write-off of uncollectible Ford Receivables
    Allowance for Doubtful Ford Receivable 1291
      Applicable Cost of Sale Accounts 4400-etc.
COMMENTS
  • At the end of each month, a reserve is to be established in Account 1291, Allowance for Doubtful Receivables, and charged to the appropriate cost of sale account, equal to all amounts aged 90 days or more from the month in which the receivable is recorded.
  • Also to be included in this account are open differences between amounts charged or claimed and as paid by Ford, regardless of age.
  • Finance and insurance receivables aged 90 days or more past due are also to be included in this reserve account.
  • Write-offs of uncollectible amounts must have prior approval of proper management authorities.
  • Collection of amounts subsequent to write-offs are to be recorded as debits to cash and credits to appropriate cost of sale accounts.