A Reasonable Amount of Uncollectible Accounts is Evidence What

A reasonable amount of Uncollectible Accounts Receivables indicates that the company’s management is adopting a sound credit policy as the management improve Credit Sales and encourage customers to purchase company’s products or services.

However, in such situation, the company’s management makes sure that it will collect unpaid invoices from customers within the due date and it all depends upon customers’ past experiences, dealings with the company, etc.