AT&U Company has the following data for the year ended December 31, Year 1: Sales (credit) $2,500,000 Sales returns and allowances 50,000 Accounts receivable (December 31, Year 1) 640,000 Allowance for doubtful accounts (before adjustment at December 31, Year 1, credit balance) 20,000 Estimated amount of uncollected accounts based on aging analysis (December 31, Year 1) On January 2, Alfredo Corporation sold merchandise with a gross price of $100,000 to a customer with terms of 2/10, n/30. How much in sales discounts will be recorded if payment is received from the customer on January 8? a. $0 b. $2,000 c. $98,000 d. $100,000 .*A company had sales of $40,000, sales discounts of $800, sales returns of $1,600, and commissions owed to salespeople of $600. What is net sales? a. $37,600 b. $38,400 c. $39,200 d. $40,000 . A company’s accounts receivable balance after posting net collections from customers is $150,000. Management has determined the following: $100,000 of the accounts that are 1 to 30 days past due are 2% uncollectible; and $50,000 of the accounts that are 31 to 60 days past due are 10% uncollectible. What is the net realizable value of the accounts receivable? a. $137,000 b. $139,000 c. $142,000 d. $143,000
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
AT&U Company has the following data for the year ended December 31, Year 1:
Sales (credit) $2,500,000
Sales returns and allowances 50,000
Accounts receivable (December 31, Year 1) 640,000
Allowance for doubtful accounts
(before adjustment at December 31, Year 1, credit balance) 20,000
Estimated amount of uncollected accounts based on aging analysis
(December 31, Year 1)
On January 2, Alfredo Corporation sold merchandise with a gross price of $100,000 to a customer with terms of 2/10, n/30. How much in sales discounts will be recorded if payment is received from the customer on January 8?
a. $0 b. $2,000 c. $98,000 d. $100,000
.*A company had sales of $40,000, sales discounts of $800, sales returns of $1,600, and commissions owed to salespeople of $600. What is net sales?
a. $37,600 b. $38,400 c. $39,200 d. $40,000
. A company’s accounts receivable balance after posting net collections from customers is $150,000. Management has determined the following: $100,000 of the accounts that are 1 to 30 days past due are 2% uncollectible; and $50,000 of the accounts that are 31 to 60 days past due are 10% uncollectible. What is the net realizable value of the accounts receivable?
a. $137,000 b. $139,000 c. $142,000 d. $143,000
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
