Q3. Presented below is information related to Samhan Trading Corp. Prepare necessary entries in general journal form for Samhan with terms 2/10, n/60. a. Account receivable of OMR 24,000 (gross) are factored with Salem Credit Corp, without guarantee at a financing charge of 7%. Cash is received for the proceeds; collections are handled by the finance company (These accounts were past the discount period). b. Specific account receivable of OMR 12,000 (gross) are pledged to Salem Credit Corp, as a security of a loan of OMR 8,000 at a finance charge of 5% of the amount of loan. The finance company will make the collection (These accounts were past the discount period).
Bad Debts
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.
![Q3.
Presented below is information related to Samhan Trading Corp. Prepare necessary entries
in general journal form for Samhan with terms 2/10, n/60.
a. Account receivable of OMR 24,000 (gross) are factored with Salem Credit Corp,
without guarantee at a financing charge of 7%. Cash is received for the proceeds;
collections are handled by the finance company (These accounts were past the discount
period).
b. Specific account receivable of OMR 12,000 (gross) are pledged to Salem Credit Corp,
as a security of a loan of OMR 8,000 at a finance charge of 5% of the amount of loan.
The finance company will make the collection (These accounts were past the discount
period).](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc75a35a7-8f17-41a1-9ca5-ac8545fd0710%2Fc8483156-6674-4137-b8e5-16cf63ce21b3%2Flrjt03d_processed.jpeg&w=3840&q=75)
![Q1. Al Jabel Corporation is preparing financial statement for the year ended December 31,
2019. For each item below, indicate the dollar amount to be reported as either current liability or
non-current liability.
a. At the end of the year 8% bonds payable of OMR 5,000,000 are outstanding. Interest
is payable on September 30 each year and mature in 4 equal instalments every
September 30.
b. At December 31, 2018, customers' advances were OMR 18,000,000. During 2019, Al
Jabel collected OMR 45,000,000 of customers' advances, and advances of OMR
37,500,000 were earned.
c. On December 31, 2019, Al Jabel declare a cash dividend of OMR 3 per share, payable
on January 15, 2021. Al Jabel has issued 2,000,000 ordinary shares of which 1,000,000
shares held in treasury.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc75a35a7-8f17-41a1-9ca5-ac8545fd0710%2Fc8483156-6674-4137-b8e5-16cf63ce21b3%2Fyw2yf7f_processed.jpeg&w=3840&q=75)
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