Samson Wholesale Beverage Company regularly factors its accounts receivable with the Milpitas Finance Company. On April 30, 2021,
Q: 5) During the month of April, Candice Ltd. provides the following information: direct materials purc...
A: Formula: Total manufacturing cost =Direct materials + Direct labor + manufacturing overhead
Q: The following financial information is available for Sheridan Ltd. as at December 31 (in thousands, ...
A: Earnings per share=Profit-Preferred share dividends (total)Weighted average number of common shares ...
Q: The business owner uses personal funds to purchase common stock in his company, what is the journal ...
A: Lets understand the basics. Journal entry is required to make to record event or transaction occur d...
Q: Catalina Corporation begins the year with a $195 balance in Retained Earnings and a $320 balance in ...
A: Stockholder's equity comprises of common stock and retained earnings balance.
Q: The following financial information is available for Sheridan Ltd. as at December 31 (in thousands, ...
A: Profit available to common stock holders= Profit- Preference dividend EPS= Profit available to commo...
Q: Prepare the necessary journals for the given transactions 1. Cash paid to Sara BD 600 2. Sold Furnit...
A: There are three golden rules in accounting for recording the transaction : Debit what comes in , C...
Q: X Company Y Company Amount Percent Amount Percent Sales s 148,000 100.00 S 148,000 100.00 Variable c...
A: Margin of safety (MOS)=Actual Sales-Break even point in sales dollars
Q: On January 1, year 1, ABC Corporation purchased 80% of XYZ Corporation's P10 par common stock for P9...
A: Goodwill refers to excess of value of investment over the fair value of net assets of subsidiary acq...
Q: Calculating Cash Flow From Assets by = Operating Cash Flow (OCF) – Net Capital Spending (NCS) - Chan...
A: Calculating Cash Flow From Assets by= Operating Cash Flow (OCF) – Net Capital Spending (NCS) - Chang...
Q: • Sam's gross pay is $4,050 and take-home pay is $3,000. • If Sam is eligible for Social Security di...
A: Disability benefits refers to the money received which is paid through the government who could not ...
Q: ABC Company had purchased a $7,500, 24-month insurance policy for a vehicle on November 1 with the c...
A: Introduction: Journals: Recording of a business transactions in a chronological order. First step in...
Q: aaArnina established a service business to be known as Arnina Photography on July 1, 2021. During th...
A: Journal entry refers to the process of recording commercial transactions for the first time in the b...
Q: Dell Company is selling sounds and lights equipment. The company’s fiscal year ends on March 31. The...
A: Warranty is a contract between the seller and buyer of the product. Under the warranty contract, the...
Q: 1 intere
A: A bond is a fixed interest bearing debt instrument issued by a company to finance its operation. Int...
Q: A city orders a new computer for its police department that is recorded within its general fund. The...
A: Given information, Anticipated cost of computer =$89,600 Actual cost of computer =$91,880 Journal ...
Q: ($) ('$) Unit Total Balance Cost in Units 50 Date Explanation Units Cost Jun-01Beginning inventory 5...
A: FIFO: COGS = 50 units x $1 + 10 units x $1.2 + 40 units x $1.2 + 110 units x $1.4 = $50 + $12 + $48 ...
Q: XYZ Corporation sells only one product with a selling price of $280 and a variable cost of $80 per u...
A: Formula: Break even point in units = Fixed cost / Unit contribution margin
Q: On January 1, 20x1, ABC Corporation purchased all of XYZ Corporation's common stock for $1,200,000. ...
A: Introduction Consolidated Retained Earnings is the amount of retained earnings that is presented in ...
Q: The Chowning Company manufactures ear buds that sell for $20 a pair. The variable cost of each set o...
A: Formula: Total cost = Variable cost + Fixed cost
Q: What is the expected result of a zero-interest-bearing note that is sold today for less than face va...
A: Solution: Zero interest bearing note are note that contains no interest and same is issued at a disc...
Q: X Company Y Company Amount Percent Amount Percent Sales S 148,000 100.00 $ 148,000 100.00 Variable c...
A: Solution.. Actual sales of company Y = $148,000 Contribution margin ratio = 70% Fixed cost = $70...
Q: Factory overhead for the period amounted to P1,200,000. Normal production of the finished goods is 5...
A: Overheads are the estimated cost which are not directly related with production. In simple, it is ag...
Q: The following information on actual and projected costs and revenues is available for Carson Enterpr...
A: Budgets are made to forecast the expenses and revenue. They also forecast the cash position (deficit...
Q: E17-13. Please solve part d, and show all workings clearly. FYI: The securities-held to maturities...
A: Unrealized Holding Gain- An unrealized holding gain is enhancing in the value of an asset that a com...
Q: Inventory turnover and 'number of days' sales in inventory Financial statement data for years ending...
A: Formula: Inventory Turnover = Cost of goods sold/ Average Inventory No of days sales in inventory = ...
Q: Some companies issue shares at a premiumand others at discount. What are the factors influencing the...
A: Shares- A share is a piece of property that can be freely transferred unless the law or a contract i...
Q: Oriole Inc is considering one of three options: (1) paying a S0.43 cash dividend, (2) distributing a...
A: Total Asset- Total assets refer to the whole amount of possessions owned by an individual or entity....
Q: A father wants to set aside money for his 5-year old son's future college education. Money can be de...
A: Present Value annuity- The present value of an annuity is the present worth of future outflow from a...
Q: Suppose that with the advent of ATMs, a person withdraws money once every two days. Further, suppose...
A: Given information, A person withdraws money once every two days. Person spends $10 per day. Theref...
Q: 7-8) This question counts as TWO multiple choice questions. Given the following adjusted trial balan...
A: Income Statement is the statement that shows the company's financial performance inclusive of the ea...
Q: Philip works at a nursing home as an aide and earns $27,000 a year. IF he went to school to get a nu...
A: An education loan seems to be an amount of money obtained to cover the costs of graduate school or h...
Q: This year, Amber purchased a business that processes and packages landscape mulch. Approimately 20 p...
A: The tax laws of United States require that the companies should evaluate the ending value of invento...
Q: munication moving in a specific C cilitates task accomplishments. munication
A: Casual communication with another person is known as informal communication.
Q: On January 1, year 1, ABC Corporation purchased 80% of XYZ Corporation's P10 par common stock for P9...
A: The question is related to Business Combination. The details are as under ABC Corporation Share in ...
Q: The process of raising thi
A: There are many methods to raise funds directly, including issuing shares and debentures.
Q: that date, the fair value of the 25% noncontrolling interest was $35,000. During year 1, XYZ had net...
A: a. Dividend paid = Cash dividend paid by ABC + Cash dividend paid by XYZ – ABC’s Share in XYZ cash d...
Q: [The following information applies to the questions displayed below.] Stellar Sound, Inc., which use...
A: Job costing appears to be a method of calculating the cost of particular projects that are performed...
Q: VI From the following information prepare a cost sheet for the month of December-2013. On December 1...
A: In the process of Cost Accounting, the Cost Sheet is an important document that has to be prepared. ...
Q: (1) What is a direct labor variance and how is it calculated?
A: Meaning : Standard costing is a technique of cost accounting in which standards are set for material...
Q: Olaf Inc. sells home improvement magazine subscriptions to customers. On September 30, 2020, the co...
A: Given that the company sold 13,500 subscriptions for $16 each. Total amount collected = 13,500 x $16...
Q: Evaluate the difficulties associated with preventing and detecting payroll fraud.
A: Payroll is the compensation that a firm must pay to its employees on a given day and for a specific ...
Q: , K2, and K3, are under consideration. No matter which design is used, daily production of sandwic...
A: The answer is stated below:
Q: Delow is the balance sheet of Gold Ace Company immediately liquidation of the partnership: P500,000....
A: Statement of liquidation shows the net cash available to pay the creditors and the partners.
Q: John plans to save money for a down payment of $38,000 to purchase an apartment. You can only afford...
A: Payment period- The payment period is the phase of time from the point a debt is incurred to the due...
Q: ssom Limited reported the following selected information for the year ended March 31, 2021: Advert...
A: The income statement explains the financial performance of the company for a particular period of ti...
Q: XYZ manufactures a computer stand. It has fixed costs of $600,000 and each stand sells for $90, with...
A: Formula: Profit = Revenues - Expenses.
Q: Compute price and usage variances for materials.
A: Ans.(1) Material price variance = (Actual Price - Standard Price) x Actual Quantity Actual Price = $...
Q: John's profit as would be calculated by an accountant?
A:
Q: iability and Equity Classification Select from the option list provided the appropriate balance ...
A: Liabilities are accumulated financial obligations that result from past events that are expected to ...
Q: How would you explain to a company’s management the primary difference between traditional and activ...
A: A system that is used for assigning the total cost incurred to different elements of business is kno...
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.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
- Comprehensive Receivables Problem Blackmon Corporations December 31, 2018, balance sheet disclosed the following information relating to its receivables: The company has a recourse liability of 700 related to a note receivable sold to a bank. During 2019, credit sales (terms, n/EOM) totaled 2,200,000, and collections on accounts receivable (unassigned) amounted to 1,900,000. Uncollectible accounts totaling 18,000 from several customers were written off, and a 1,350 accounts receivable previously written off was collected. Additionally, the following transactions relating to Blackmons receivables occurred during the year: On December 31, 2019, an aging of the accounts receivable balance indicated the following: Required: 1. Prepare the journal entries to record the preceding receivable transactions during 2019 and the necessary adjusting entry on December 31, 2019. Assume a 360-day year for interest calculations and round calculations to the nearest dollar. 2. Prepare the receivables portion of Blackmons December 31, 2019, balance sheet. 3. Next Level Compute Blackmons accounts receivable turnover in days, assuming a 360-day business year. What is your evaluation of its collection policies? 4. If Blackmon uses IFRS, what might be the heading of the section for the receivables reported in Requirement 2?10- SK Inc, factors $400,000 of accounts receivable with Mars Finance Company on a without recourse basis on July 1,2020. The receivables records are transferred to Mars Finance, which will receive the collections. Mars Finance assesses a finance charge of 1 ½% of the amount of accounts receivable and retains an amount equal to 4% of accounts receivable to cover sales discounts, returns, and allowances. The transaction is to be recorded as a sale.Instructions:a) Prepare the journal entry on July1,2020, for SK Inc. to record the sale of receivables without recourse.b) Prepare the journal entry on July1,2020, for Mars Finance Company. to record the purchase of receivables without recouThis is a variation of E 7–20 modified to focus on factoring with recourse under IFRS.]Mountain High Ice Cream Company reports under IFRS. Mountain High transferred $60,000 of accounts receivable to the Prudential Bank. The transfer was made with recourse. Prudential remits 90% of the factored amountto Mountain High and retains 10% to cover sales returns and allowances. When the bank collects the receivables,it will remit to Mountain High the retained amount (which Mountain estimates has a fair value of $5,000). Mountain High anticipates a $3,000 recourse obligation. The bank charges a 2% fee (2% of $60,000), and requires thatamount to be paid at the start of the factoring arrangement. Mountain High has transferred control over the receivables, but determines that it still retains substantially all risks and rewards associated with them.Required:Prepare the journal entry to record the transfer on the books of Mountain High, considering whether the sale criteria under IFRS have been…
- E7.8 (LO 3) (Recording Bad Debts) At the end of 2020, Aramis Company has accounts receivable of $800,000 and an allowance for doubtful accounts of $40,000. On January 16, 2021, Aramis Company determined that its receivable from Ramirez Company of $6,000 will not be collected, and management authorized its write-off. Instructions: a. Prepare the journal entry for Aramis Company to write off the Ramirez receivable. b. Prepare the entries if Ramirez later pays back half of what he owed.36. Otter Company has a receivable amounting to P1,200,000; Otter had previously established an Allowance for bad debts of P50,000 in connection with these receivables. Otter Company sold these receivables with recourse for P1,060,000. Otter received P1,000,000 cash immediately from the factor. The remaining P60,000 will be received once the factor verifies that none of the receivables is in dispute. Control was surrendered by Otter. The fair value of the recourse obligation is P26,000. The loss on factoring to be recognized by Otter Company is?37. Starboy Company has the following data relating to accounts receivable for the year ended December 31, 2022: Accounts receivable, January 1, 2022 P 480,000 Allowance for doubtful accounts, 1/1/22 28,600 Cash sales 300,000 Sales on account, terms: 2/10, 1/15, n/30 2,560,000 Cash received from customers during the year 2,400,000 Accounts written off during the year 17,600 Cash refunds given…56. Otter Company has a receivable amounting to P1,200,000; Otter had previously established an Allowance for bad debts of P50,000 in connection with these receivables. Otter Company sold these receivables with recourse for P1,060,000. Otter received P1,000,000 cash immediately from the factor. The remaining P60,000 will be received once the factor verifies that none of the receivables is in dispute. Control was surrendered by Otter. The fair value of the recourse obligation is P26,000. The loss on factoring to be recognized by Otter Company is
- 47. On June 30, 2021, CPA Company factored P2,500,000 of accounts receivable for P2,250,000. The allowance for uncollectible accounts for these factored receivables was P50,000. On December 1, 2021, CPA Company assigned accounts receivable of P3,500,000 as collateral of a P2,000,000, 12% annual interest rate loan from a commercial bank. CPA received the P2,000,000 less 2% finance charge based on the loan. How much is the total loss/expenses related to factoring and assignment of receivables for the year 2021?7. ABC Co. factored P100,000 accounts receivable to B Bank on a without recourse basis on January 1, 20X1. B Bank charged a 4% service fee and retained a 10% holdback to cover expected sales returns. In addition, B Bank charged a 12% interest on the average maturity of the receivables of 73 days over 365 days. How much is the net proceeds from the factoring? 100,320 88,300 85,600 83,60012. On February 1, 2021, MARIGOLD Company factored receivables with a carrying amount of ₱300,000 to SUNFLOWER Company. SUNFLOWER Company assesses a finance charge of 3% of the receivables and retains 5% of the receivable for possible sales returns. Relative to this transaction, you are to determine the amount of loss on sale or factoring to be reported in the income statement of MARIGOLD Company for February. Assume that MARIGOLD factors the receivables on a without recourse basis. The loss to be reported is? * a. ₱ 24,000 b. ₱ 15,000 c. ₱ 9,000 d. ₱ -0-
- 8. Use the following information for the next two questions: Pampi's Co. has the following information. Days Outstanding Receivable Balances % collectible 0-60 480,000 1% 61-120 360,000 2% Over 120 400,000 6% During the year, Pampi wrote off P14,000 receivables and recovered 8,000 that had been written-off in prior years. The allowance for doubtful accounts has a beginning balance of P4,000. How much is the net realizable value of accounts receivable at year-end? How much is the doubtful accounts expense?45.Ping Company finances some of its current operations by factoring its accounts receivable to a finance company. On July 1, 2021, the company factored P2,000,000 of its accounts receivable to Atlas Finance Company. Purchase price was 85% of the receivables factored. Atlas withheld 5% of the purchase price as protection against sales returns and allowances.Sales returns recorded by Ping on the factored accounts receivable totaled P30,000; the balance of the factor’s holdback was settled by the finance company on August 31, 2021.What was the total cash received by Ping Company from this factored accounts after full settlement by the factor?Culver Corp. factors $351,000 of accounts receivable with Larkspur Finance Corporation on a without recourse basis on July 1, 2020. The receivables records are transferred to Larkspur Finance, which will receive the collections. Larkspur Finance assesses a finance charge of 1.90% of the amount of accounts receivable and retains an amount equal to 4% of accounts receivable to cover sales discounts, returns, and allowances. The transaction is to be recorded as a sale. Prepare the journal entry on July 1, 2020, for Culver Corp. to record the sale of receivables without recourse. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)