Answered: t note from MN in settlement of the…

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter16: Accounting For Accounts Receivable

Section: Chapter Questions

Problem 3CP: At the end of 20-3, Martel Co. had 410,000 in Accounts Receivable and a credit balance of 300 in...

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Purple Co showed the following balances as of Dec 31, 2021 · Account receivable P2,000,000 · All for doubtful accounts (60,000) The ff transactions transpired during the year

a. On May 1, received a P300,000 six months 12 int note from MN in settlement of the account

b. On June 30 factored P400,000 of its accounts receivable in a finance com. The finance co charged a factoring fee of 5 pct of the accounts and withheld 20 pct of the amount factored

c. On Aug 1 Purple discounted the MN note at the bank at 15 pct

d. On Nov 1 MN defaulted on the P300,000 note and Purple paid the bank the total amount plus a P12,000 protest fee and charges

e. On Dec 31, Purple assigned P600k of its account sreceivable to a bank under a non notification basis. The bank advanced 80 pct less service fee of 5 pct of the accounts assigned. Purple signed a promissory note for the loan

f. On dec 31 Purple collected fromMN in full incuding interest on otal amount de at 12 pct since default date g. On Dec 31 it is estimated that 5 pct of the outstanding accounts may proved uncollectible Compute for the following

1. Amount received on June 30 factoring

2. Amount of cash received on Aug 1 discounting

3. Amount paid on Nov 1 default on the P300k loan

4. Amount of cash received on Dec 31 assignment of accounts receivable

5. Amount of cash received on Dec 31 collection of accounts from MN

6. Net realizable value of the accounts receivable at Dec 31

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