1. Agogo Trading has the following account balances as at 30 June 2019. RM 200,000 6,000 Account Receivable Provision for doubtful debt On 30 June 2019, the following adjustment have to be made: i. Debts of RM500 are to be written off as bad ii. One of the entities with accounts receivable whose debts had previously been written off as bad sent a cheque for RM1,000 in full settlement of the amount owed iii. Provision for doubtful debts is 2% of the outstanding accounts receivables Required: For the year ending 30 June 2019 show the: a) Provision for doubtful debts account b) Statement of Profit or LOss (extract) c) Statement of Financial Position (extract)

1. Agogo Trading has the following account balances as at 30 June 2019. RM 200,000 6,000 Account Receivable Provision for doubtful debt On 30 June 2019, the following adjustment have to be made: i. Debts of RM500 are to be written off as bad ii. One of the entities with accounts receivable whose debts had previously been written off as bad sent a cheque for RM1,000 in full settlement of the amount owed iii. Provision for doubtful debts is 2% of the outstanding accounts receivables Required: For the year ending 30 June 2019 show the: a) Provision for doubtful debts account b) Statement of Profit or LOss (extract) c) Statement of Financial Position (extract)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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21. During 2019, Company A had net credit sales of Php 600,000. Its Accounts Receivable and Allowance for Doubtful Accounts as of December 31, 2019 before adjustment are Php 100,000 and Php 2,000, respectively. The age of the receivables are as follow: Php 40,000: 0-60 days old; Php 60,000: over 60 days old. If the company uses Aging of Receivables, what should be the amount of Doubtful Accounts Expense to recognize if an allowance of 2% is granted to 0-60 days old receivables and 10% to over 60 days old receivables?
The following information is available for AVS-CVN Company: Credit sales during 2019 P 8,000,000 Accounts receivable deemed worthless and written off during 2019 180,000 Allowance for doubtful accounts at December 31, 2018 160,000 As a result of a review and aging of accounts receivable in early January 2020, however, it has been determined that an allowance for doubtful accounts of P110,000 is needed at December 31, 2019. What amount should AVS-CVN record as doubtful accounts expense for the year ended December 31, 2019? P130,000 c. P90,000 P110,000 d. P270,000
Subject: accounting
Amounts owing by customers amounted to £650,000 at 31 December 2020. The business sets the provision for doubtful debts at 2.5% of trade receivables. The provision for doubtful debts at 31 December 2020 amounted to £19,340.The final adjustment relating to doubtful debts in the accounts for the year ended 31December 2020 will be:a) Dr Doubtful debts charge 16,250 Cr Trade receivables 16,250b) Dr Doubtful debts charge 3,090 Cr Doubtful debts provision 3,090c) Dr Doubtful debts provision 3,090 Cr Doubtful debts charge 3,090d) Dr Doubtful debts charge 16,250 Cr Doubtful debts provision 16,250
5. Guernsey Company began operations on January 1, 2021. On December 31, 2021, the entity provided doubtful accounts based on 1% of annual credit sales. On January 1, 2022, the entity changed the method of determining the allowance for doubtful accounts by aging of accounts receivable. Days past invoice date Percent uncollectible 0 - 30 31 90 91 - 180 Over 180 1 5 20 80 In addition, the entity wrote off all accounts receivable that were over 1 year old. The entity provided the following additional information: 0 - 30 31 - 90 91 - 180 Over 180 Credit sales Collections, including recovery Accounts written off Recovery of accounts previously written off Days past invoice date at December 31 2022 2021 3,000,000 2,800,000 2,915,000 2,400,000 27,000 7,000 300,000 80,000 60,000 25,000 None None 250,000 90,000 45,000 15,000 a. What is the allowance for doubtful accounts on December 31, 2021? b. What is the allowance for doubtful accounts on December 31, 2022? c. What amount should be reported…
What is the answer in D?
Accounts Receivable Free Company gathered the following information from its accounting records for the year ended December 31, 2019: • Net Credit Sales for the year - P680,000 • Accounts Receivable at December 31 - 92,000 • Allowance for doubtful accounts at December 31 - 1,850
Explain the differences and implications between the ‘allowance method’ and the ‘direct write-off method’ of accounting for bad debts.
7.Pearl has trade receivables at the year-end amounting to RMI50,000. An irrecoverable debt of RM3,500 is to be written off. Pearl has an opening allowance of doubtful debts of RM1,000 and wishes to maintain an allowance of 5% of year-end accounts receivable. What is the balance carried down on the allowance of doubtful debts account after dealing with the above item? a) RM10,825 b) RM6,325 c) RM7,325 d) RM3,825 8.A company pays rent quarterly in arrears on 1 January, 1 April, I July and 1 October each year. The rent was increased from RM90,000 per year to RM120,000 per year as from 1 October 2012. What rent expense and acerual should be included in the company's financial statements for the year ended 31 January 2013? a) Rental expense RM100,000 ; Accrual RM10,000 b) Rental expense RM100,000 ; Accrual RM20,000 c) Rental expense RM97,500; Accrual RM20,000 d) Rental expense RM97,500 ; Accrual RM10,000