5. The following balances were extracted from the books of Atuobi Trading Company on 30 November 2011 Cash Credit Cash - Credit GHC 344,890 268,187 14,440 496,600 Sales Purchases Total receipts from customers Total payments to suppliers Discount allowed Discount received Refunds given to cash customers Balance in the sales ledger set off-ogainst balance in the purchases ledger Bad debt written off Increase in the provisioh for bad debt Credit notes issued to credit customers Credit note received from suppliers 600,570 503,970 5,520 3,510 5,070 70 780 06 4,140 1,480 According to the audited financial statement for the previous year, debtors and creditors as at 1 December 2010 were GH¢26,555 and GH¢43,450 respectively. You are required to prepare: a) Total Debtors Ledger Control Account b) Total Creditor Ledger Control Accounts. ....

5. The following balances were extracted from the books of Atuobi Trading Company on 30 November 2011 Cash Credit Cash - Credit GHC 344,890 268,187 14,440 496,600 Sales Purchases Total receipts from customers Total payments to suppliers Discount allowed Discount received Refunds given to cash customers Balance in the sales ledger set off-ogainst balance in the purchases ledger Bad debt written off Increase in the provisioh for bad debt Credit notes issued to credit customers Credit note received from suppliers 600,570 503,970 5,520 3,510 5,070 70 780 06 4,140 1,480 According to the audited financial statement for the previous year, debtors and creditors as at 1 December 2010 were GH¢26,555 and GH¢43,450 respectively. You are required to prepare: a) Total Debtors Ledger Control Account b) Total Creditor Ledger Control Accounts. ....

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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Concept explainers

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.

Question

5.
The following balances were extracted from the books of Atuobi
Trading Company on 30 November 2011
GHE
344,890
268,187
14,440
496,600
- Cash
Credit
Sales
Purchases- Cash
- Credit
600,570
503,970
5,520
3,510
5,070
Total receipts fram customers
Total payments to suppliers
Discount allowed
Discount received
Refunds given to cash customers
Balance in the sales ledger-set off-against
balance in the purchases ledger
Bad debt written off
Increase in the provisioh for bad debt
Credit notes issued to credit customers
Credit note received from suppliers
70
780
06
4,140
1,480
According to the audited financial statement for the previous year,
debtors and creditors as at 1 December 2010 were GH¢26,555 and
GH¢43,450 respectively.
You are required to prepare:
a) Total Debtors Ledger Control Account
b) Total Creditor Ledger Control Accounts.
....

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Uncollectible Accounts-Percentage of Sales and Percentage of Receivables At the completion of the current fiscal year ending December 31, the balance of Accounts Receivable for Yang's Gift Shop was $30,000. Credit sales for the year were $355,200. Required: Make the necessary adjusting entry in general journal form under each of the following assumptions. Show the calculation for net realizable value. 1. Allowance for Doubtful Accounts has a credit balance of $330. a. The percentage of sales method is used and bad debt expense is estimated to be 2% of credit sales. Page: DOC. POST. NO. REF. DATE ACCOUNT TITLE DEBIT CREDIT 20-- 1 Dec. 31 88 Bad Debt Expense V 2 Allowance for Doubtful Accounts - 2. 3 Feedback Accounts receivable, December 31, 20-- Less allowance for doubtful accounts Net realizable value Feedback b. The percentage of receivables method is used and an analysis of the accounts produces an estimate of $6,950 in uncollectible accounts. Page: DOC. POST. NO. REF. DATE ACCOUNT…
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Exercise 228 (Part Level Submission) The percentage of receivables approach to estimating bad debts expense is used by Oriole Company. On February 28 (the fiscal yearend), the firm had accounts receivable in the amount of $573,000 and Allowance for Doubtful Accounts had a credit balance of $1,850 before adjustment. Net credit sales for February amounted to $3,480,000. The credit manager estimated that uncollectible accounts would amount to 6% of accounts receivable. On March 10, an accounts receivable from Mark Dole for $2,100 was determined to be uncollectible and written off. However, on March 31, Dole received an inheritance and immediately paid his past due account in full. (a) Prepare the journal entries made by Oriole Company on the below dates: (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) 1. February 28 2. March 10 3. March 31 Date Account Titles and…
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