PROBLEM 1 Credible Company provided the following T-account summarizing the transactions affecting the accounts receivable for the current year: Jan. 1 balance Charge sales Shareholder’ subscriptions Deposit on contract Claims against common carrier for damages IOUs from employees Cash advance to affiliates Advances to a supplier Accounts Receivable 600,000 Collections from customers 6,000,000 Writeoff 200,000 Merchandise returns 120,000 Allowances to customer for shipping damages 100,000 Collections on carrier claims 10,000 Collection on subscriptions 100,000 50,000 5,300,000 35,000 40,000 25,000 40,000 50,000 Required: 1. Compute the correct amount of accounts receivable. 2. Compute the amount to be presented as “trade and other receivables” under current assets. PROBLEM 2 Jinx Company provided the following information for the current year in relation to accounts receivable: Accounts receivable, January 1 1,300,000 Credit sales 5,500,000 Sales return 150,000 Accounts written off 100,000 Collections from customers 5,000,000 Estimated future sales return on December 31 50,000 Estimated uncollectible accounts per aging at year-end 250,000 What amount should be reported as net realizable value of accounts receivable on December 31? PROBLEM 3 Von Company provided the following data for the current year in relation to accounts receivable: Debits January 1 balance after deducting credit balance P30,000 Charge sales Charge for goods out on consignment Shareholders’ subscriptions Accounts written off but recovered Cash paid to customer for January 1 credit balance Goods shipped to cover January 1 credit balance Deposit on long-term contract Claim against common carrier Advances to supplier Credits Collections from customers, including overpayment of P50,000 Writeoff Merchandise returns Allowances to customers for shipping damages Collection on carrier claim Collection on subscription 530,000 5,250,000 50,000 1,000,000 10,000 25,000 5,000 500,000 400,000 300,000 5,200,000 35,000 25,000 15,000 50,000 200,000 What amount should be reported as accounts receivable on December 31? What total amount of trade and other receivables should be reported under current assets? What total amount of other receivables should be reported under noncurrent assets? PROBLEM 4 Affectionate Company sold merchandise on account for P500,000. The terms are 3/10, n/30. The related freight charge amounted to P10,000. The account was collected within the discount period. 1 Required: Prepare journal entries to record the transactions under the following freight terms: 1. FOB destination and freight collect 2. FOB destination and freight prepaid 3. FOB shipping point and freight collect 4. FOB shipping point and freight prepaid PROBLEM 5 At the beginning of current year, Relentless Company reported the following balances: Accounts receivable 600,000 Allowance for doubtful accounts 25,000 The following transactions took place in the current year. 1. Sales - cash and credit 2. Cash received from credit customers 3. Cash received from credit customers who took advantage of the 3/10, n / 30 credit terms (included in No. 2) 4. Accounts receivable written off as worthless 5. Cash received from cash customers 6. Credit memo for sales return and allowances issued to credit customers 7. Cash refunds to cash customers 8. Recoveries of accounts written off, not included in above collections 3,070,000 2,455,000 1,455,000 20,000 470,000 55,000 10,000 5,000 Required: a. Prepare journal entries to record the transactions. b. Prepare the adjustment for doubtful accounts if the entity provides for doubtful accounts equal to 2% of net credit sales. c. Determine the net realizable value of accounts receivable at year-end? PROBLEM 6 At the beginning of current year, Rampant Company reported that the allowance for doubtful accounts has a credit balance of P170,000. Bad debt recoveries and bad- debts written off in the current year were P30,000 and P235,000, respectively. The allowance account had been previously calculated as a percentage of net sales. It was decided however to provide for doubtful accounts commencing with the year-end adjusting entry on the basis of an analysis of the age of the receivables. The following schedule was prepared. Percent uncollectible Not yet due 1,700,000 NIL 1-30 days past due 1,200,000 5 31-60 days past due 100,000 25 61-90 days past due Over 90 days past due Additional accounts to be written off 150,000 120,000 30,000 50 100 Required: 1. What is the required allowance for doubtful accounts at year-end? 2. How much would be the doubtful accounts expense for the current year? 3. What is the adjusting entry for the doubtful accounts expense for the current year? 4. What is the net realizable value of accounts receivable at year-end? PROBLEM 7 Sky Company provided the following information at year-end: 2020 Accounts receivable 880,000 Allowance for doubtful accounts -10,000 Allowance for sales returns -20,000 Net realizable value 850,000 2019 800,000 -15,000 -25,000 760,000 The entity reported doubtful accounts expense in 2020 of P30,000 and had products returned for credits totaling P15,000 at sale price. Gross sales for 2020 amounted to P6,150,000. What amount of accounts receivable was written during 2020? What amount was collected from customers during 2020? What amount was recorded as estimated sales returns during 2020?