Problem 4-2

A. Compute the correct amount of accounts receivable.

Accounts Receivable-Beginning 600,000

Charge Sales 6,000,000
Total 6,600,000
Less:
Collections from customers 5,300,000
Writeoff 35,000
Merchandise returns 40,000
Allowance to customer 25,000 (5,400,000)

Accounts Receivable-Ending 1,200,00

B. Prepare one compound entry to adjust the accounts receivable.

Subscription Receivable 150,000

Deposit on Contract 120,000
Claim Receivable 60,000
Advances to Employees 10,000
Advances to Affiliates 100,000
Advances to Supplier 50,000
Accounts Receivable 490,000
C. Compute the amount to be presented as "trade and other receivables"
under current assets.

Accounts Receivable 1,200,000

Claim Receivable 60,000
Advances to Employees 10,000
Advances to Supplier 50,000
Total trade and other receivables 1,320,000

D. Indicate the classification and presentation of the other items.

Subscription receivable should be deducted from subscribed share capital.

Problem 4-3
Prepare journal entries to record the transactions under the following freight
terms:
1. Accounts Receivable 500,000
Freight Out 10,000
Sales 500,000
Allowance for Freight Charge 10,000
To record sale of merchandise and freight charge.

Cash 475,000
Sales Discount 15,000
Allowance for Freight Charge 10,000
Accounts Receivable 500,000
To record collection of accounts within the discount period.

2. Accounts Receivable 500,000

Freight Out 10,000
Sales 500,000
Cash 10,000
To record sales of merchandise on account.

Cash 485,000
Sales Discount 15,000
Accounts Receivable 500,000
To record collection of accounts withing the discount period.

3. Accounts Receivable 500,000

Sales 500,000
To record the sales of merchandise on account.

Cash 485,000
Sales Discount 15,000
Accounts Receivable 500,000
To record collection of accounts withing the discount period.

4. Accounts Receivable 510,000

Sales 500,000
Cash 10,000
To record the sales of merchandise on account.
 Cash 495,000
Sales Discount 15,000
Accounts Receivable 510,000
To record collection of accounts withing the discount period.

Problem 4-4
Prepare journal entries to record the transactions.
1. Accounts Receivable 4,000,000
Sales 4,000,000

2. Cash 1,470,000
Sales Discount 30,000
Accounts Receivable 1,500,00

3. Cash 1,000,000
Accounts Receivable 1,000,000

4. Sales Return 100,000

Accounts Receivable 100,000

5. Sales Return 20,000

Allowance for Sales Return 20,000

Problem 4-5
1. Accounts Receivable 4,500,000
Sales 4,500,000

2. Cash 4,410,000
Sales Discount 90,000
Accounts Receivable 4,500,000

3. Cash 4,500,000
 Accounts Receivable 4,500,000

Problem 5-3
A. Prepare journal entries to record the transactions .

Problem 5-4
Problem 6-6