Accounting True or False/ Why: Companies that sell on open-account to reputable customers can expect to collect 100 percent of the sales they make to such customers.
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Accounting
True or False/ Why: Companies that sell on open-account to reputable customers can expect to collect 100 percent of the sales they make to such customers.
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- A company regularly sells its receivables to a factor who assesses a 2% service charge on the amount of receivables purchased. Which of the following statements is true for the seller of the receivables? The credit to Accounts Receivable is less than the debit to Cash when the accounts are sold. Selling expenses will increase each time accounts are sold. The other expense section of the income statement will increase each time accounts are sold. The loss section of the income statement will increase each time receivables are sold.Hisense Traders recruited you as their accountant for 31 July 2021 financial year. The Business has the following information. Credit Sales N$ 582 000 Mark-up N$ 30% Opening Stock N$ 38 400 Closing Stock N$ 18 800 Total expenses N$ 43 100 Debtors Turnover 12 times Creditors turnover 16 times Current assests N$ 155 600 Current Liabilities N$ 77 800 Calculate the following Gross prifit Cost of sales Purchases Inventory turnover (days) Net profit margin Debtors Balance Creditors Balance Current Ratio Cash Balance Bank overdraft. Round-off your answers to the nearest zero decimal place.During the current year , an entity reported beginning allowance for doubtful accounts P200,000 , sales 99, 500, 000 sales returns and allowances P1,000,000 , sales discounts P500,000 , accounts written off P300,000 and recovery of accounts written off 0, 000 . It is estimated that 5% of net sales may prove uncollectible . What amount should be reported as doubtful accounts expense ?
- Suppose your firm receives a $5.82 million order on the last day of the year. You fill the order with $1.97 million worth of inventory. The customer picks up the entire order the same day and pays $1.09 million up front in cash; you also issue a bill for the customer to pay the remaining balance of $4.73 million within 40 days. Suppose your firm's tax rate is 0% (i.e., ignore taxes). Determine the consequences of this transaction for each of the following: a. Revenues b. Earnings c. Receivables d. Inventory e. Cash a. Revenues Revenues will ▼ increase or decrease by $___ million. (Select from the drop-down menu and round to two decimal places.)Suppose your firm receives a $4.93 million order on the last day of the year. You fill the order with $1.89 million worth of inventory. The customer picks up the entire order the same day and pays $1.23 million up front in cash; you also issue a bill for the customer to pay the remaining balance of $3.70 million within 40 days. Suppose your firm's tax rate is 0% (i.e., ignore taxes). Determine the consequences of this transaction for each of the following: a. Revenues b. Earnings c. Receivables d. inventory e. cashTheon Company has $4,000,000 of sales and $200,000 of accounts receivable for the year. The company estimates 2% of its sales will become uncollectible. If Allowance for Doubtful Accounts has a $900 credit balance, the adjustment to record uncollectible accounts for the period will require a debit to bad debt expense for: Group of answer choices $79,100 $80,000 $3,100 $80,900
- Cabanes Factors provides financing to other companies by purchasing their accounts receivable on a non-recourse basis. Cabanes charges a commission to its clients of 15% of all receivables factored. In addition, Cabanes withholds 10% of receivables factored for protection against sales returns or adjustments. Cabanes credits the 10% withheld to Client Retainer and makes payments to clients at the end of each month so that the balance in the retainer is equal to 10% of unpaid receivables at the end of the month. Cabanes recognizes its 15% commissions as revenue at the time the receivables are factored. Also, experience has led Cabanes to establish allowance for bad debts of 4% of all receivables purchased. On January 2, 2021, Cabanes purchased receivables from Cabana Company totaling P3,000,000. Cabana has previously established an allowance for bad debts for these…Doll Company provided the following data for the current year: Allowance for doubtful accounts- January 1, 180,000 Sales 9,500,000 Sales returns and allowances 800,000 Sales discounts 200,000 Accounts written off as uncollectible 200,000 The entity provided for doubtful accounts expense at the rate of 3% of net sales. What is the allowance for doubtful accounts at year-end? a. P435,000 b. P265,000 c. P235,000 d. P241,000The following are excerpts from the financial statements of 2018 and 2019 of Mandela Corporation. 2019 2018 Sales $187,600 $195,000 Accounts Receivable (net): Beginning of Year 68,100 66,500 End of Year 60,200 68,100 A newly hired manager has started implementing new credit policies. Required: a. As a consultant, you are contracted to analyze Accounts Receivable Turnover and Number of Days’ Sales in Receivable and provide opinion as to whether Mandela’s credit policy changes are working b. What conclusions does your analysis suggest. Are the new credit policies working?
- A company had the following partial list of account balances at year-end: Sales returns and allowances $1,000 Accounts receivable $38,000 Sales discounts $2,100 Sales revenue $95,000 Allowance for doubtful accounts $1,200 How much is net sales revenue? Group of answer choices A)$91,900 B)$90,700 C)$89,900 D)$88,600 E)None of the aboveThe sales journal for Carothers Company is shown below. SALES JOURNAL Date Sales Slip No. Customer Name Post.Ref. AccountsReceivableDebit Sales taxPayableCredit SalesCredit Dec. 1 824 Jim Danta 3,212 312 2,900 7 825 Tom Tome 645 45 600 22 826 Sue Wasco 666 66 600 31 Totals 4,523 423 4,100 Show how the amounts would be posted to the general ledger accounts.A company is getting ready to publish their annual financial statements. They have the following beginning balances: Beginning balance for gross accounts receivable (A) $2,000 beginning balance for Allowance for doubtful accounts (XA) $300 question: now supposed that the company recorded $50 in write-offs for the current accounting period. if the company makes $10,000 in credit sales in the current period. Assume that 1% of credit sales are typically not collectible, using the income statement method, what is the bad expense now? please show work so I can understand the problem
