Problem 4-5 (IAA) On June 15, 2020, Romela Company sold 100 air conditioning units. The sale price for each unit is P45,000. All of sales are subject to terms 2/10, n30. The entity used the gross method of accounting for accounts receivable. Required: 1. Prepare journal entry to record the sale. 2. Prepare journal entry to record receipt of the payment assuming the correct amount was received on June 25, 2020. 3. Prepare the journal entry to record receipt of the payment assuming the correct amount was received on July 10, 2020.

Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter5: Sales And Receivables
Section: Chapter Questions
Problem 54BE
icon
Related questions
Topic Video
Question
At year-end, Harem Company reported accounts receivable
of P8,200,000 with the following analysis:
Problem 4-11 (PHILCPA Adapted)
100,000
400,000
1,000,000
Accounts known to be worthless
Advance payments on purchase orders
Advances to subsidiary
Customers' accounts reporting credit balances arising
from sales returns
Trade accounts receivable
Subscription receivable due in 30 days
Trade installments receivable due 1-18 months,
including unearned finance charge of P50,000
Trade accounts receivable from officers, due currently
Trade accounts on which postdated checks are held and
no entries were made on receipt of checks
( 600,000)
3,500,000
2,200,000
850,000
150,000
200,000
What is the correct balance of trade accounts receivable?
a. 4,650,000
b. 4,700,000
c. 4,150,000
d. 4,050,000
128
Transcribed Image Text:At year-end, Harem Company reported accounts receivable of P8,200,000 with the following analysis: Problem 4-11 (PHILCPA Adapted) 100,000 400,000 1,000,000 Accounts known to be worthless Advance payments on purchase orders Advances to subsidiary Customers' accounts reporting credit balances arising from sales returns Trade accounts receivable Subscription receivable due in 30 days Trade installments receivable due 1-18 months, including unearned finance charge of P50,000 Trade accounts receivable from officers, due currently Trade accounts on which postdated checks are held and no entries were made on receipt of checks ( 600,000) 3,500,000 2,200,000 850,000 150,000 200,000 What is the correct balance of trade accounts receivable? a. 4,650,000 b. 4,700,000 c. 4,150,000 d. 4,050,000 128
Problem 4-5 (IAA)
On June 15, 2020, Romela Company sold 100 air conditioning
units. The sale price for each unit is P45,000.
All of sales are subject to terms 2/10, n30. The entity used
the gross method of accounting for accounts receivable.
Required:
1. Prepare journal entry to record the sale.
2. Prepare journal entry to record receipt of the payment
assuming the correct amount was received on June 25, 2020.
3. Prepare the journal entry to record receipt of the payment
assuming the correct amount was received on July 10, 2020.
125
Transcribed Image Text:Problem 4-5 (IAA) On June 15, 2020, Romela Company sold 100 air conditioning units. The sale price for each unit is P45,000. All of sales are subject to terms 2/10, n30. The entity used the gross method of accounting for accounts receivable. Required: 1. Prepare journal entry to record the sale. 2. Prepare journal entry to record receipt of the payment assuming the correct amount was received on June 25, 2020. 3. Prepare the journal entry to record receipt of the payment assuming the correct amount was received on July 10, 2020. 125
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps

Blurred answer
Knowledge Booster
Accounting Equation
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Corporate Financial Accounting
Corporate Financial Accounting
Accounting
ISBN:
9781305653535
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
Financial Accounting: The Impact on Decision Make…
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
Financial Accounting Intro Concepts Meth/Uses
Financial Accounting Intro Concepts Meth/Uses
Finance
ISBN:
9781285595047
Author:
Weil
Publisher:
Cengage