ABC Company has the following data relating to accounts receivable for the year ended December 31, 2020: Accounts Receivable, January 1- P325,000 Allowance for Bad Debts, January 1- P18,400 Sales during the year, all on account, terms: 5/10, 3/15, n/30- P2,800,000 Cash received from customers during the year- P2,260,000 Accounts written off during the year- P17,500 Sales returns and allowances- P14,280 An analysis of cash received from customers during the year revealed that P1,140,000 was received from customers availing the 10-day discount period, P873,000 was received from customers availing the 15-day discount period, P12,000 represented recovery of accounts written off, and the balance was received from customers paying beyond the discount period. ABC Company's year-end balance of allowance for bad debts was estimated to be 5% of the outstanding accounts receivable as of December 31, 2020, based on the aging of the accounts.

ABC Company has the following data relating to accounts receivable for the year ended December 31, 2020: Accounts Receivable, January 1- P325,000 Allowance for Bad Debts, January 1- P18,400 Sales during the year, all on account, terms: 5/10, 3/15, n/30- P2,800,000 Cash received from customers during the year- P2,260,000 Accounts written off during the year- P17,500 Sales returns and allowances- P14,280 An analysis of cash received from customers during the year revealed that P1,140,000 was received from customers availing the 10-day discount period, P873,000 was received from customers availing the 15-day discount period, P12,000 represented recovery of accounts written off, and the balance was received from customers paying beyond the discount period. ABC Company's year-end balance of allowance for bad debts was estimated to be 5% of the outstanding accounts receivable as of December 31, 2020, based on the aging of the 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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