How to Determine the Gross Balance in Accounts Receivable
It's important to know how much money customers owe when you applying for loans or determine the value of your business. The gross balance of your accounts receivable is the total balance of any receivable accounts that your business has. Typically, a company has at least two receivable accounts: collectible receivables and non-collectible receivables. To determine the gross balance in your account receivables, you must know the balance of your receivable accounts.
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Instructions
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Examine your balance sheet to locate the balance of your accounts receivable. Typically, your receivable account is the first asset account.
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Locate your non-collectible, or doubtful accounts, allowance. This is the amount that you estimate that you will not collect.
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Add the balances on any receivable accounts to calculate your gross accounts receivables balance. For example, if you have $10,000 in your net receivables and $300 in your non-collectible allowance, you have a gross account receivables balance of $10,300.
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Tips & Warnings
Your net receivables is your gross receivables minus your non-collectible receivables. While you cannot be sure how much is noncollectable, you can use information from previous years to estimate the amount. When you write off the receivable, you must subtract the amount from your non-collectible allowance.
