On January 1, 2020, the records of ABC Company showed a debit balance of P650,000 in its Accounts Receivable account. The following summary transactions that occurred during 2020 were also shown under the said account: Debits: Charge sales, P6,300,000 Shareholders’ subscriptions, P200,000 Deposit on contract, P120,000 Claims against common carrier for shipping damages, P100,000 IOUs from employees, P10,000 Cash advances to affiliates, P150,000 Advances to a supplier, P30,000 Credits: Collections from customers, P5,300,000 Write-off, P35,000 Merchandise returns, P45,000 Allowances to customers for shipping damages, P25,000 Collections on carrier claims, P40,000 Collections on subscriptions, P50,000 Required: a. Determine the correct amount of accounts receivable. b. Compute the amount to be presented as “trade and other receivables” under current assets.
On January 1, 2020, the records of ABC Company showed a debit balance of P650,000 in its
Debits:
Charge sales, P6,300,000
Shareholders’ subscriptions, P200,000
Deposit on contract, P120,000
Claims against common carrier for shipping damages, P100,000
IOUs from employees, P10,000
Cash advances to affiliates, P150,000
Advances to a supplier, P30,000
Credits:
Collections from customers, P5,300,000
Write-off, P35,000
Merchandise returns, P45,000
Allowances to customers for shipping damages, P25,000
Collections on carrier claims, P40,000
Collections on subscriptions, P50,000
Required:
a. Determine the correct amount of accounts receivable.
b. Compute the amount to be presented as “trade and other receivables” under current assets.
Step by step
Solved in 2 steps with 2 images
