Provision for Uncollectible Accounts

The amount reported as provision for uncollectible accounts in the reconciliation section of the statement of cash flows must tie to the difference in the allowance for uncollectible accounts between the previous fiscal year and the current fiscal year as reported on the balance sheet.

For instance, if the provision for uncollectible accounts was $5,500 on August 31, 20PY and $7,500 on August 31, 20CY, the amount reported in the reconciliation section of the cash flow statement is $2,000.

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