Rifle Co. is a distributing company selling toy guns to retailers at 10/15, 5/20, n/30 and it provides for uncollectible accounts based on aging of receivables at year-end. The balance of selected accounts taken from the December 31, 2020 statement of financial position are as follows: Accounts Receivable - P19,800,000; Allowance for Bad Debts - P300,000 The following transactions (in summary) affecting accounts receivable occurred during the year ended December 31, 2021: Sales on account - 20,180,000 Cash received from customers - 20,000,000 Cash received includes the following: Customers paying within the 15-day discount period - 9,000,000 Customers paying within the 20-day discount period - 3,800,000 Recovery of accounts written off- 106,000 Accounts receivable written off as worthless - 20,000 An aging of the accounts receivables and uncollectible accounts at December 31, 2021 revealed the following: Amount P4,100,000 Probability of Non-collection 5% Age Less than 30 days 31-90 days 91-120 days More than 120 days 2,400,000 8% 563,000 10% Balance 27% At what amount should Accounts Receivable, net of Allowance for Doubtful Accounts, be reported at December 31, 2021?

Rifle Co. is a distributing company selling toy guns to retailers at 10/15, 5/20, n/30 and it provides for uncollectible accounts based on aging of receivables at year-end. The balance of selected accounts taken from the December 31, 2020 statement of financial position are as follows: Accounts Receivable - P19,800,000; Allowance for Bad Debts - P300,000 The following transactions (in summary) affecting accounts receivable occurred during the year ended December 31, 2021: Sales on account - 20,180,000 Cash received from customers - 20,000,000 Cash received includes the following: Customers paying within the 15-day discount period - 9,000,000 Customers paying within the 20-day discount period - 3,800,000 Recovery of accounts written off- 106,000 Accounts receivable written off as worthless - 20,000 An aging of the accounts receivables and uncollectible accounts at December 31, 2021 revealed the following: Amount P4,100,000 Probability of Non-collection 5% Age Less than 30 days 31-90 days 91-120 days More than 120 days 2,400,000 8% 563,000 10% Balance 27% At what amount should Accounts Receivable, net of Allowance for Doubtful Accounts, be reported at December 31, 2021?

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

ChapterB: Bad Debts

Section: Chapter Questions

Problem 2P: Hardys Landscape Services total revenue on account for 2018 amounted to 273,205. The company, which...

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Concept explainers

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.

Question

Question: At what amount should Accounts Receivable, net of Allowance for Doubtful Accounts, be reported at December 31, 2021?

Rifle Co. is a distributing company selling toy guns to retailers at 10/15, 5/20, n/30 and it provides for
uncollectible accounts based on aging of receivables at year-end. The balance of selected accounts taken
from the December 31, 2020 statement of financial position are as follows:
Accounts Receivable – P19,800,000; Allowance for Bad Debts – P300,000
The following transactions (in summary) affecting accounts receivable occurred during the year ended
December 31, 2021:
Sales on account - 20,180,000
Cash received from customers - 20,000,000
Cash received includes the following:
Customers paying within the 15-day discount period - 9,000,000
Customers paying within the 20-day discount period - 3,800,000
Recovery of accounts written off - 106,000
Accounts receivable written off as worthless - 20,000
An aging of the accounts receivables and uncollectible accounts at December 31, 2021 revealed the
following:
Amount
P4,100,000
Probability of Non-collection
Age
Less than 30 days
31-90 days
91-120 days
|More than 120 days
5%
2,400,000
8%
563,000
10%
Balance
27%
At what amount should Accounts Receivable, net of Allowance for Doubtful Accounts, be reported at
December 31, 2021?

Definition Definition Money that the business will be receiving from its clients who have utilized the credit provided to buy its goods and services. The credit period typically lasts for a short term, lasting from a few days, a few months, to a year.

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