NUMBER 1

Accounts Receivable on Dec 31

Balance as on January 1 2,300,000
Add: Credit Sales 6,400,000
Less: Collection 5,750,000
Less: Accounts written off 125,000
Balance as on December 31 2,825,000

NUMBER 2
Trade accounts receivable 900,000
Allowance for doubtful accounts (25,000)
Claim against shipper for goods lost
in transit in November 50,000
trade and other receivables
under current assets at year-end 925,000

NUMBER 3
Purchases 14,000,000
Inventory. December 31 (2,800,000)
Cost of goods sold 11,200,000

Markup on cost (40% x11,200,000) 4,480,000

Sales (140% x 11,200,000) 15,680,000

Collections from customers (8,000,000)
Accounts receivable - December 31 7,680,000
NUMBER 4
What is the accounts receivable balance at December 31,2020? 270,400
How much was Crewey’s bad debts expense for the year ended December 31, 2020? 7,120

SOLUTION :

ACCOUNTS RECEIVABLE
Beg. Balance 480,000 Sales discount 36,800
Sales 2,400,000 Cash 2,560,000
Allowance for doubtful 4,800 Allowance for doubtful accounts 17,600
accounts

ENDING BALANCE 270,400

Customers availing 15 days discount – 28,800 (1,411,200/ 98%*2%)

Customers availing 10 days discount – 8,000 (792,000 / 99%*1%)
Sales discount - 36,800

Allowance for doubtful debts

Accounts receivable 17,600

Beg. Balance (19,200)
Accounts receivable (4,800)
Ending balance (5% of 270,400) 13,520
Bad debts expense (7,120 )

NUMBER 5

Age Amount Estimated Uncollectible TOTAL

0 - 30 days P600,000 x 5%  30,000
31-60 days 40,000 x 10% 4,000
Over 60 days 20,000 14,000
Adjusted Balance of Allowance 48,000
NUMBER 6

Accounts Receivable December 31, 2019 375,000

Amortized cost December 31, 2019 (362,500)
Allowance Dec 2019 12500

Accounts Receivable December 31, 2020 500,000

Amortized cost December 31, 2020 (480,000)
Allowance Dec 2020 20000

Allowance Dec 2019 12500

uncollectible accounts (7,500)
recovered accounts 3,700
Unadjusted Allowance 2020 8700

Allowance Dec 2020 20000

Unadjusted Allowance 2020 (8700)
Uncollectible Accounts expense 11,300

MULTIPLE CHOICE ANSWERS

1. D
2. D
3. D
4. D
5. D
6. C
7. C
8. B
9. A
10. B