On December 31 of Swift Co.’s first year, $69,000 of accounts receivable is not yet collected. Swift estimates that $3,900 of its accounts receivable is uncollectible and records the year-end adjusting entry.(1) Compute the realizable value of accounts receivable reported on Swift’s year-end balance sheet.(2) On January 1 of Swift’s second year, it writes off a customer’s account for $500. Compute the realizable value of accounts receivable on January 1 after the write-off.

Formula: Realizable value = Accounts receivable - Uncollectible accounts receivable Deduction of…

Answered: On December 31 of Swift Co.’s first…

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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On December 31 of Swift Co.’s first year, $69,000 of accounts receivable is not yet collected. Swift estimates that $3,900 of its accounts receivable is uncollectible and records the year-end adjusting entry.

(1) Compute the realizable value of accounts receivable reported on Swift’s year-end balance sheet.
(2) On January 1 of Swift’s second year, it writes off a customer’s account for $500. Compute the realizable value of accounts receivable on January 1 after the write-off.

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