On December 15, 2013, the accounts receivable balance was $50,000 and the balance in the allowance for doubtful accounts was $5,000. That morning, a $1,000 uncollected account was written-off. The net realizable value of accounts receivable immediately after the write-off is:

Question

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Before the write-off, the net realizable value of accounts receivable was $50,000 - $5,000 = $45,000. After the write-off, the accounts receivable balance is reduced by $1,000 to $49,000. Since the allowance for doubtful accounts was already deducted in the calculation of the net realizable value, there is no need to adjust it after the write-off. Therefore, the net realizable value is $49,000, which is choice C.

On December 15, 2013, the Accounts Receivable Balance Was $50,000