How much is the remittance of MedLab Inc. to the bank by the end of September? At the beginning of July, MedLab Inc. assigned P2,000,000 out of its P10,000,000 outstandingaccounts receivable to BPI in consideration of a P1,400,000, 12% loan. BPI charged the company 5%of the loan principal as service charge. By the end of July, MedLab collected P600,000 cash from theassigned accounts net of a P50,000 sales discount. Also, by the end of July, the company accepted acustomer return of merchandise amounting to P60,000.By the end of August, MedLab collected another P700,000 from the assigned accounts after P40,000sales discount. The company also wrote-off P80,000 as worthless accounts by the end of August.By the end of September, MedLab collected another P300,000 without sales discounts. The agreementwith the bank provides a monthly remittance from customer collections and it will cover both theprincipal and interest.

Cash Remittance A cash remittance is one in which the sender puts cash into the recipient's account…

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How much is the remittance of MedLab Inc. to the bank by the end of September?

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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Question

How much is the remittance of MedLab Inc. to the bank by the end of September?

At the beginning of July, MedLab Inc. assigned P2,000,000 out of its P10,000,000 outstanding
accounts receivable to BPI in consideration of a P1,400,000, 12% loan. BPI charged the company 5%
of the loan principal as service charge. By the end of July, MedLab collected P600,000 cash from the
assigned accounts net of a P50,000 sales discount. Also, by the end of July, the company accepted a
customer return of merchandise amounting to P60,000.
By the end of August, MedLab collected another P700,000 from the assigned accounts after P40,000
sales discount. The company also wrote-off P80,000 as worthless accounts by the end of August.
By the end of September, MedLab collected another P300,000 without sales discounts. The agreement
with the bank provides a monthly remittance from customer collections and it will cover both the
principal and interest.

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