Scribd
Upload
53 views

Chapter One Assignment On Receivables

This document provides instructions for 13 different problems related to accounting for receivables. It covers topics like calculating note maturity values and discounts, journalizing transactions involving notes receivable, using the direct write-off and allowance methods for uncollectible accounts, aging receivables, estimating bad debts, and adjusting the allowance for doubtful accounts.

Uploaded by

Bee Tadele
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
53 views

Chapter One Assignment On Receivables

This document provides instructions for 13 different problems related to accounting for receivables. It covers topics like calculating note maturity values and discounts, journalizing transactions involving notes receivable, using the direct write-off and allowance methods for uncollectible accounts, aging receivables, estimating bad debts, and adjusting the allowance for doubtful accounts.

Uploaded by

Bee Tadele
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 3

Individual Assignment on Receivables

1. Explain receivable with examples.


2. Write the difference between direct write off method and allowance method.
3. Define dishonored note.
4. What is NRV?
5. Explain aging receivables with its steps.
6. MAM- Co. holds a 90-day, 10% note for Br. 100,000 dated June-12 that was received from a
customer on account. On June 30, the note is discounted at Enat-Bank at the rate of 14 %.
A. Determine the maturity value of the note.
B. Determine the number of days in the discount period
C. Determine the amount of the discount.
D. Determine the amount of the proceeds
E. Present the journal entry required to record the discounting of the note on June 30.
7. Prepare journal entries to record the following transactions entered in to by UNION-Comp
during the year 2020
Sep 1- Received a Br. 10, 000, 12%, 60-day note from YOYO-Co.as full settlement of his
open account.
Oct 20- Sold merchandise on account to ADIDAS-Co. for Br. 25,000 by receiving a 90-
day, 10% note.
Oct 31- Received full payment from YOYO-Co for notes received on September 1.
8. Down- Company, a construction supply company, uses the allowance method of accounting
for uncollectible accounts receivable. Selected transactions completed by D-Company are as
follows:
Feb. 1. Sold merchandise on account to A-Co., $8,000.
Mar. 15. Accepted a 60-day, 12% note for $8,000 from A-Co. on account.
Apr. 9. Wrote off a $2,500 account from B- Co. as uncollectible.
21. Loaned $7,500 cash to P-Co, receiving a 90-day, 14% note.
May.14. Received the interest due from A-Co. and a new 90-day, 14% note as a renewal
of the loan. (Record both the debit and the credit to the notes receivable
account.)
June 13. Reinstated the account of B-Co, written off on April 9, and received $2,500 in full
payment.
July 20. P-Co dishonored the note.
Aug. 12. Received from A-Co. the amount due on its note of May 14.
19. Received from P-Co the amount owed on the dishonored note, plus interest for 30
days at 15%, computed on the maturity value of the note.
Dec. 16. Accepted a 60-day, 12% note for $12,000 from Global Company on account.

1|Page
31. It is estimated that 3% of the credit sales of $1,375,000 for the year ended December
31 will be uncollectible.
Instructions
1. Journalize the transactions.
2. Journalize the adjusting entry to record the accrued interest on December 31 on the
Global Company note.
9. At the end of the current year, the accounts receivable account has a debit balance of
$840,000, and net sales for the year total $7,150,000. Determine the amount of the adjusting
entry to provide for doubtful accounts under each of the following assumptions:
A. The allowance account before adjustment has a credit balance of $1,780. Uncollectible
accounts expense is estimated at 1/4 of 1% of net sales.
B. The allowance account before adjustment has a credit balance of $2,750. An aging of the
accounts in the customer’s ledger indicates estimated doubtful accounts of $16,350.
C. The allowance account before adjustment has a debit balance of $3,050. Uncollectible
accounts expense is estimated at 1/2 of 1% of net sales.
D. The allowance account before adjustment has a debit balance of $3,050. An aging of the
accounts in the customer’s ledger indicates estimated doubtful accounts of $38,400.
10. Journalize the following transactions of Beta-Co:
July 8. Received a $30,000, 90-day, 8% note from NICK Company on account.
Oct. 6. The note is dishonored by NICK Company.
Nov. 5. Received the amount due on the dishonored note plus interest for 30 days at 10% on
the total amount charged to NICK Company on October 6.
11. Journalize the following transactions in the accounts of Blue Sky Co.
Mar. 1. Received a $15,000, 60-day, 5% note from ABC-Co. on account.
18. Received a $12,000, 90-day, 9% note from ST- Co. on account.
Apr. 30. The note dated March 1 from ABC- Co. is dishonored
June 16. The note dated March 18 from ST- Co. is dishonored.
July 11. Cash is received for the amount due on the dishonored note dated March 1 plus
interest for 72 days at 8% on the total amount debited to ABC-Co. on
April 30.
Oct. 12. Wrote off against the allowance account the amount charged to ST Co. on June 16
for the dishonored note.
12. Net sales for the month are $800,000, and bad debts are expected to be 1.5% of net sales. The
company uses the percentage-of-sales basis. If Allowance for Doubtful Accounts has a credit
balance of $15,000 before adjustment. Prepare the journal entry and what is the balance after
adjustment?
13. HU-Company has a credit balance of $5,000 in its Allowance for Doubtful Accounts before
any adjustments are made at the end of the year. Based on review and aging of its accounts

2|Page
receivable at the end of the year, HU-Company estimates that $60,000 of its receivables are
uncollectible. Prepare journal entry

3|Page

You might also like