Mooncake Corp.’s accounts payable at December 31, 2018, totaled P800,000 before any necessary year-end adjustments relating to the following transactions: · On December 27, 2018, Mooncake wrote and recorded checks to creditors totaling P350,000 causing an overdraft of P100,000 in Mooncake’s bank account at December 31, 2018. The checks were mailed out on January 10, 2019. · On December 28, 2018, Mooncake purchased and received goods for P150,000, terms 2/10, n/30. Mooncake records purchases and accounts payable at net amounts. The invoice was recorded and paid January 3, 2019. · Goods shipped f.o.b. destination on December 20, 2018 from a vendor to Mooncake were received January 2, 2019. The invoice cost was P65,000. At December 31, 2018, what amount should Mooncake report as total accounts payable? a.) P1,362,000 b.) P1,297,000 c.) P1,050,000 d.) P950,000
Mooncake Corp.’s accounts payable at December 31, 2018, totaled P800,000 before any necessary year-end adjustments relating to the following transactions: · On December 27, 2018, Mooncake wrote and recorded checks to creditors totaling P350,000 causing an overdraft of P100,000 in Mooncake’s bank account at December 31, 2018. The checks were mailed out on January 10, 2019. · On December 28, 2018, Mooncake purchased and received goods for P150,000, terms 2/10, n/30. Mooncake records purchases and accounts payable at net amounts. The invoice was recorded and paid January 3, 2019. · Goods shipped f.o.b. destination on December 20, 2018 from a vendor to Mooncake were received January 2, 2019. The invoice cost was P65,000. At December 31, 2018, what amount should Mooncake report as total accounts payable? a.) P1,362,000 b.) P1,297,000 c.) P1,050,000 d.) P950,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
Question
Mooncake Corp.’s accounts payable at December 31, 2018, totaled P800,000 before any necessary year-end adjustments relating to the following transactions:
· On December 27, 2018, Mooncake wrote and recorded checks to creditors totaling P350,000 causing an overdraft of P100,000 in Mooncake’s bank account at December 31, 2018. The checks were mailed out on January 10, 2019.
· On December 28, 2018, Mooncake purchased and received goods for P150,000, terms 2/10, n/30. Mooncake records purchases and accounts payable at net amounts. The invoice was recorded and paid January 3, 2019.
· Goods shipped f.o.b. destination on December 20, 2018 from a vendor to Mooncake were received January 2, 2019. The invoice cost was P65,000.
At December 31, 2018, what amount should Mooncake report as total accounts payable?
· On December 27, 2018, Mooncake wrote and recorded checks to creditors totaling P350,000 causing an overdraft of P100,000 in Mooncake’s bank account at December 31, 2018. The checks were mailed out on January 10, 2019.
· On December 28, 2018, Mooncake purchased and received goods for P150,000, terms 2/10, n/30. Mooncake records purchases and accounts payable at net amounts. The invoice was recorded and paid January 3, 2019.
· Goods shipped f.o.b. destination on December 20, 2018 from a vendor to Mooncake were received January 2, 2019. The invoice cost was P65,000.
At December 31, 2018, what amount should Mooncake report as total accounts payable?
a.) P1,362,000
b.) P1,297,000
c.) P1,050,000
d.) P950,000
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