Required information. [The following information applies to the questions displayed below] Suzuki Supply reports the following amounts at the end of 2021 (before adjustment). Credit Sales for 2021 Accounts Receivable, December 31, 20211 Allowance for Uncollectible Accounts, December 31, 2021 $258,000 53,000 1,200 (Credit) 3. Calculate the effect on net income (before taxes) and total assets in 2021 for each method. Suzuki estimates 11% of receivables and 3% of credit sales respectively will not be collected. Percentage of Receivables Method Total assets Net Income Percentage of Credit Sales Methodi
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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.
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Required information
[The following information applies to the questions displayed below]
Suzuki Supply reports the following amounts at the end of 2021 (before adjustment).
Credit Sales for 2021
Accounts Receivable, December 31, 2021.
Allowance for Uncollectible Accounts, December 31, 2021
$258,000
53,000
1,200 (Credit)
3. Calculate the effect on net income (before taxes) and total assets in 2021 for each method. Suzuki estimates 11% of receivables and
3% of credit sales respectively will not be collected
Percentage of Receivables Method
Total assets
Net Income
Percentage of Credit Sales Method](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fa880cc3d-71b2-44bc-9eb8-ccb18aa2c0ed%2F116bc4e9-2d54-494f-bc1e-3571bb49d9bd%2Ffhsub1s_processed.jpeg&w=3840&q=75)
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