One of the most important assumptions behind the calculation of quick ratio is that: The firm’s accounts receivables can be collected and converted into cash within the time period for which credit was granted The firm’s inventories are highly liquid and can be sold quickly with minimal loss of value to assist in the settlement of the firm’s financial obligations The firm’s accounts receivables will be collected late (after the expiration of the credit period) or are uncollectible

Colorado rocky cookie company offers credit terms to its customers. at the end of 2018, accounts receivable totaled $715,000. the allowance method is used to account for uncollectible accounts. the allowance for uncollectible accounts had a credit balance of $50,000 at the beginning of 2018 and $30,000 in receivables were written off during the year as uncollectible. also, $3,000 in cash was received in december from a customer whose account previously had been written off. the company estimates bad debts by applying a percentage of 15% to accounts receivable at the end of the year. 1. prepare journal entries to record the write-off of receivables, the collection of $3,000 for previously written off receivables, and the year-end adjusting entry for bad debt expense.2. how would accounts receivable be shown in the 2018 year-end balance sheet?