during the year, Marion Produce's receivable collection period increased from 11 to 21 days. the company mKes sales on credit. all customers are allowed credit terms of 1/10, n/30. which is true? a. the company is not doing well in collecting amounts due from customers b. the company is earning less profit on its sales than it has in the past c. the company is doing a better job in collecting amounts owed by customers d the company is writing off more uncollectible accounts than it did in the past

during the year, Marion Produce's receivable collection period increased from 11 to 21 days. the company mKes sales on credit. all customers are allowed credit terms of 1/10, n/30. which is true? a. the company is not doing well in collecting amounts due from customers b. the company is earning less profit on its sales than it has in the past c. the company is doing a better job in collecting amounts owed by customers d the company is writing off more uncollectible accounts than it did in the past

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter18: The Management Of Accounts Receivable And Inventories

Section: Chapter Questions

Problem 5QTD

See similar textbooks

Related questions

Q: Calculate the allowance for uncollectible accounts for East Bay, Inc., the total balance in accounts…

A: As per ageing of accounts receivables, allowance for doubtful accounts is calculated by multipying…

Q: The Manda Panda Company uses the allowance method to account for bad debts. At the beginning of…

A: 1.In the given situation, liability is a contingent liability and is probably and reasonably…

Q: Deegan Industries has an accounts receivable turnover rate of 8. Which of the following statements…

A: Accounting ratios are financial ratios through which a company can analyze its performance in terms…

Q: Bud Lighting Co. is a retailer of commercial and residential lighting products. Gowen Geter, the…

A: Bad debt expense:Bad debt expense is an expense account. The amounts of loss incurred from extending…

Q: California Cannery began in 2008 with a debit balance in Accounts Receivable $150,000 and a credit…

A: Given the following information: Beginning balance of Accounts Receivable: $150,000 Beginning…

Q: At the end of last year, the company had $654,000 in outstanding Accounts Receivable and a credit…

A: Allowance for Doubtful Accounts: It is a contra account which is deducted from the total…

Q: Credit Losses Based on Percentage of Credit Sales Highland Company uses the allowance method of…

A: Allowance for doubtful accounts means where we expect some debts to become bad in near future then…

Q: On December 31, Year 1, the Loudoun Corporation estimated that 3% of its credit sales of $112.500…

A: The account receivables is the current assets for the business. It means those customers to whom…

Q: Providing for Doubtful Accounts At the end of the current year, the accounts receivable account has…

A: The adjusting entry is posted at the end of the accounting year to record unrecorded revenues and…

Q: Innovative Tech Inc. (ITI) has been using the percentage of credit sales method to estimate bad…

A: Formulas:

Q: Innovative Tech Inc. (ITI) uses the percentage of credit sales method to estimate bad debts…

A: PARTICULAR DEBIT CREDIT Bad debts expense 500 To Allowance for Doubtful Accounts 500…

Q: During the current year, Giatras Electronics recorded credit sales of $710,000. Based on prior…

A: Bad debts = $710,000 x 3% = $21,300

Question

during the year, Marion Produce's receivable
collection period increased from 11 to 21 days. the
company mKes sales on credit. all customers are
allowed credit terms of 1/10, n/30.
which is true?
a. the company is not doing well in collecting
amounts due from customers
b. the company is earning less profit on its sales
than it has in the past
c. the company is doing a better job in collecting
amounts owed by customers
d the company is writing off more uncollectible
accounts than it did in the past

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Bulldogs Inc. had credit sales last year amounted to P18,600,000. The firm also had an average accounts receivable balance of P1,380,000. Credit terms are 2/10, n/30. Bulldogs’ average collection period last year was (Use 360-day year) 26.71 days. 27.32 days. 26.22 days. 33.45 days. Which is correct with regards to the effects of restricting credit standards? An increase in recognition of doubtful accounts expense will probably happen Positive impact on the net profit can be noted from decline in the quantity of goods sold Investment in accounts receivable will likely increase Quantity of units sold will probably decrease and will result to a lower sales revenue
Please help me to solve this problem
1.) Beltline Co. had credit sales of $100,000 for the year, and based on experience estimates that approximately 1% of these sales will be uncollectible. Under the percent of sales method, a.the adjusting entry to record the uncollectible sales would involve a debit to Allowance for Doubtful Accounts and a credit to Bad Debt Expense. b.the estimated uncollectible sales should not be recorded until there is firm evidence that a customer will not pay. c.the estimated bad debt expense is $1,000. d.the estimated bad debt expense is $10,000. 2.) Under the percentage of receivables method theory, a.the majority of accounts receivable portion will not be collected. b.some portion of the existing accounts receivable will not be collected. c.the percentage of uncollectible accounts is calculated as Average Uncollectible Accounts divided by Average Accounts Receivable. d."some portion of the existing accounts receivable will not be collected" and "the percentage of uncollectible…
Domestic
Providing for Doubtful Accounts At the end of the current year, the accounts receivable account has a debit balance of $1,169,000 and sales for the year total $13,260,000. The allowance account before adjustment has a debit balance of $15,800. Bad debt expense is estimated at 1/4 of 1% of sales. The allowance account before adjustment has a debit balance of $15,800. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $50,600. The allowance account before adjustment has a credit balance of $6,000. Bad debt expense is estimated at 3/4 of 1% of sales. The allowance account before adjustment has a credit balance of $6,000. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $49,800. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above.
Please Solve This Question International Industries sells on terms of 3/10, net 50. Gross sales last year were 5,662,500 and accounts receivable averaged 547,500. Half of International’s customers paid on the 15th day and took discounts. What are the nominal and effective costs of trade credit to International’s non-discount customers? (Hint: Calculate sales/day based on a 360-day year, then calculate average receivables of discount customers and then find the DSO for the non-discount customers.
I only have one chance left...If someone could answer this I would really appreciate it!
Please provide a complete and neat solution. Thank you!
Saved Net credit sales for the year Accounts receivable at year-end Uncollectible accounts receivable: Actually written off during the year Estimated portion of year-end receivables expected to prove uncollectible (per aging schedule) work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate completi Save & Exit $ 8,000,000 1,750,000 180,000 Subr Return to question 1
Aubrey Company that you work for had credit sales of P3,500,000 last year and on average had P33,000 in its accounts receivable during the year. What is its average collection period? * None of the choices 3.44 days 3.5 days O 3 days
trout lumber Yard has a current accounts receivable balance of $442016. Credit sales for the year just ended were $9358610 a. What is the receivables turnover? b. What is the day's receivables? c. How long did it take on average for credit customers to pay off their accounts during the past year? a. Receivables turnover _____ times b. Days sales in receivables ____ days c. Average collection period_____ days
At the end of the current year, the accounts receivable account has a debit balance of $1,191,000 and sales for the year total $13,510,000. a. The allowance account before adjustment has a debit balance of $16,100. Bad debt expense is estimated at 1/2 of 1% of sales. b. The allowance account before adjustment has a debit balance of $16,100. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $51,500. c. The allowance account before adjustment has a credit balance of $8,600. Bad debt expense is estimated at 3/4 of 1% of sales. d. The allowance account before adjustment has a credit balance of $8,600. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $71,400. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above. 51,450 X a. b. $ C. $ d. $ Feedback