Business Finance - Accounting Homework accounting

3. What type of transactions can create a difference between your balance per books-like your checking account-and the balance per bank? (Hint: look at bank reconciliations).

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1.1 Why is the A/R-Accounts Receivable-Aging Report the best way to estimate the amount of your receivables that will be uncollectible? .

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2.2 The A/R Turnover is computed by dividing your net credit sales by your average net A/R. A turnover number of 12 means your are collecting your receivables every 30 days (365 days divided by 12). Explain why all businesses want a high A/R turnover number.

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3.3 Most businesses take MasterCard, Visa, etc. because the Cash is in their account the next day, less a 1-3% service charge. Companies don't have to worry about collecting the money...that's the card company's responsibility. Why would a company 'factor' or sell all or some of their Receivables...usually to a bank or finance company?

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