Problem 5-20 (AICPA Adapted)-06) From inception of operations, Comprehensive Company provided for uncollectible accounts expense under the allowance method using the percentage of sales method. No year-end adjustments to the allowance account were made. The balance in the allowance for doubtful accounts was P1,000,000 at the beginning of current year. During the current year, credit sales totaled P20,000,000, interim provisions for doubtful accounts were made at 2% of credit sales, bad debts of P200,000 were written off, and recoveries of accounts previously written off amounted to P50,000. An aging of accounts receivable was made for the first time on December 31. POR Aging Balance Uncollectible 0 60 6,000,000 10% 61 - 180 2,000,000 20% 181 - 360 1,500,000 30% 30 Over 360 500,000 50% 280 130 Based on the review of collectibility of the account balances in the "over 360 days" aging category, additional accounts totaling P100,000 are to be written off on December 31. Effective with the current year, the entity adopted a new accounting method for estimating the allowance for doubtful accounts at the amount indicated by the year-end aging of accounts receivable. PAT Im. 1.

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Question
pany
the
d.
made.
was
000,
% of
and
d to
ime
ces
nts
ew
ful
of
What amount was reported as allowance for doubtful
accounts on December 31 before adjustment?
1.
1,100,000
a.
b. 1,150,000
c. 1,250,000
d. 1,200,000
2.
What amount should be reported as required allowance
for doubtful accounts on, December 31?
a. 1,650,000
b. 1,950,000
c. 1,700,000
d. 1,450,000
3. What amount should be reported as doubtful accounts
expense for the current year?
a. 1,200,000
b. 1,650,000
C. 900,000
d. 950,000
4. What is the year-end adjustment to the allowance for
doubtful accounts on December 31?
a. 900,000 debit
b. 900,000 credit
c. 500,000 debit
d. 500,000 credit
5. What amount should be reported as net realizable value
of accounts receivable on December 31?
a. 9,900,000
b. 8,250,000
c. 8,350,000
d. 8,200,000
165
TOV
certifie
Receivable
Transcribed Image Text:pany the d. made. was 000, % of and d to ime ces nts ew ful of What amount was reported as allowance for doubtful accounts on December 31 before adjustment? 1. 1,100,000 a. b. 1,150,000 c. 1,250,000 d. 1,200,000 2. What amount should be reported as required allowance for doubtful accounts on, December 31? a. 1,650,000 b. 1,950,000 c. 1,700,000 d. 1,450,000 3. What amount should be reported as doubtful accounts expense for the current year? a. 1,200,000 b. 1,650,000 C. 900,000 d. 950,000 4. What is the year-end adjustment to the allowance for doubtful accounts on December 31? a. 900,000 debit b. 900,000 credit c. 500,000 debit d. 500,000 credit 5. What amount should be reported as net realizable value of accounts receivable on December 31? a. 9,900,000 b. 8,250,000 c. 8,350,000 d. 8,200,000 165 TOV certifie Receivable
1
U
4
pardo
Problem 5-20 (AICPA Adapted)
From inception of operations, Comprehensive Company
provided for uncollectible accounts expense under the
allowance method using the percentage of sales method.
No year-end adjustments to the allowance account were made.
The balance in the allowance for doubtful accounts was
P1,000,000 at the beginning of current year.
During the current year, credit sales totaled P20,000,000,
interim provisions for doubtful accounts were made at 2% of
credit sales, bad debts of P200,000 were written off, and
recoveries of accounts previously written off amounted to
P50,000.
An aging of accounts receivable was made for the first time
on December 31.
000 293
800.000
Aging
Balance
Uncollectible
0-
60
6,000,000
10%
61 180
2,000,000
20%
181
360
1,500,000
Over 360
500,000
30% 30
50% 20
Based on the review of collectibility of the account balances
in the "over 360 days" aging category, additional accounts
totaling P100,000 are to be written off on December 31.
Effective with the current year, the entity adopted a new
accounting method for estimating the allowance for doubtful
accounts at the amount indicated by the year-end aging of
accounts receivable.
AR
PAT!
Im.
100K 980k
10
m
100.)
200 OPE
A
250 ADA
ank
1.
2.
3.
W
ac
a
b
C
C
4.
Transcribed Image Text:1 U 4 pardo Problem 5-20 (AICPA Adapted) From inception of operations, Comprehensive Company provided for uncollectible accounts expense under the allowance method using the percentage of sales method. No year-end adjustments to the allowance account were made. The balance in the allowance for doubtful accounts was P1,000,000 at the beginning of current year. During the current year, credit sales totaled P20,000,000, interim provisions for doubtful accounts were made at 2% of credit sales, bad debts of P200,000 were written off, and recoveries of accounts previously written off amounted to P50,000. An aging of accounts receivable was made for the first time on December 31. 000 293 800.000 Aging Balance Uncollectible 0- 60 6,000,000 10% 61 180 2,000,000 20% 181 360 1,500,000 Over 360 500,000 30% 30 50% 20 Based on the review of collectibility of the account balances in the "over 360 days" aging category, additional accounts totaling P100,000 are to be written off on December 31. Effective with the current year, the entity adopted a new accounting method for estimating the allowance for doubtful accounts at the amount indicated by the year-end aging of accounts receivable. AR PAT! Im. 100K 980k 10 m 100.) 200 OPE A 250 ADA ank 1. 2. 3. W ac a b C C 4.
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