ABC Auditor has agreed to perform an inventory count for XYZ on 12/31/Y1, but will allow them to pay over time. XYZ’s normal borrowing rate is 6%. ABC will require XYZ to pay a down payment of $15,000 at 12/31/Y1 and the remainder in the form of a $35,000 note, at 14% interest, due $12/31/Y6. Interest will be due semi-annually. Find the following: 1. Service Revenue for 12/31/Y1: $ 2. How much Interest Revenue was recorded year to date at 12/31/Y3:
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.
N7.
ABC Auditor has agreed to perform an inventory count for XYZ on 12/31/Y1, but will allow them to pay over time.
XYZ’s normal borrowing rate is 6%.
ABC will require XYZ to pay a down payment of $15,000 at 12/31/Y1 and the remainder in the form of a $35,000 note, at 14% interest, due $12/31/Y6. Interest will be due semi-annually.
Find the following:
1. Service Revenue for 12/31/Y1: $
2. How much Interest Revenue was recorded year to date at 12/31/Y3:
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