Compute trend percents for the above accounts, using 2017 as the base year. For each of the three accounts, state whet: situation as revealed by the trend percents appears to be favorable or unfavorable
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.
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Sales
Cost of goods sold
Accounts receivable
2021:
2020:
2019:
Numerator:
Base year cost of goods sold
2021
$ 719,206
376,387
34,953
Numerator:
Compute trend percents for the above accounts, using 2017 as the base year. For each of the three accounts, state whether the
situation as revealed by the trend percents appears to be favorable or unfavorable.
Numerator:
2018:
2017:
Is the trend percent for Net Sales favorable or unfavorable?
2020
$ 467,017
244,349
27,274
Trend Percent for Net Sales:
1
Denominator:
/Base year accounts receivable
1
1
7
/
1
1
1
1
1
Trend Percent for Cost of Goods Sold:
1
Denominator:
2021:
2020:
2019:
2018:
2017:
Is the trend percent for Cost of Goods Sold favorable or unfavorable?
2019
$ 379,689
200,588
26,085
1
1
7
1
Trend Percent for Accounts Receivable:
Denominator:
2021:
2020:
2019:
2018:
2017:
1
Is the trend percent for Accounts Receivable favorable or unfavorable?
1
2018
$ 253,126
132,876
14,808
=
=
=
=
=
=
=
=
=
=
=
=
2017
$ 188,900
98,228
12,921
Trend percent
200
Trend percent
Trend percent
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
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