The financial statements of Exo Corporation included the following: December 31, 2022 December 31, 2021 3,675,000 81,000 Accounts receivable Allowance for doubtful accounts Sales on account Cash collected from customers 22,500,000 21,000,000 Among the cash collections was the full recovery of an P80,000 receivable from Big Company, a customer whose account had been written off as worthless late in 2021. During 2022, it was necessary to write off uncollectible customers' accounts totaling P101,000. On December 1, 2022, Bang Electronics, In., a customer, settled its account by issuing to Exo Corporation a 12%, six- month note for P1,300,000. At December 31, 2022, the accounts receivable included P504,000 past due accounts. After careful study of all past-due accounts, the management estimated that the probable loss contained therein was 10%. In addition, 2% of the current accounts receivable might prove uncollectible.
The financial statements of Exo Corporation included the following: December 31, 2022 December 31, 2021 3,675,000 81,000 Accounts receivable Allowance for doubtful accounts Sales on account Cash collected from customers 22,500,000 21,000,000 Among the cash collections was the full recovery of an P80,000 receivable from Big Company, a customer whose account had been written off as worthless late in 2021. During 2022, it was necessary to write off uncollectible customers' accounts totaling P101,000. On December 1, 2022, Bang Electronics, In., a customer, settled its account by issuing to Exo Corporation a 12%, six- month note for P1,300,000. At December 31, 2022, the accounts receivable included P504,000 past due accounts. After careful study of all past-due accounts, the management estimated that the probable loss contained therein was 10%. In addition, 2% of the current accounts receivable might prove uncollectible.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
Question
1.
What is the balance of Accounts receivable as of December 31, 2022?
3,854,000
3,674,000
3,774,000
5,154,000
2.
What is the amount of the current accounts receivable that might prove to be uncollectible?
65,400
63,400
67,000
77,080
3.
What is the balance of the allowance for uncollectible accounts before adjustments on December 31, 2022?
60,000 credit
81,000 credit
20,000 debit
161,000 credit
4.
How much increase in the allowance for uncollectible accounts is required on December 31, 2022?
57,400
40,320
43,600
137,400
5.
What is the balance of the allowance for uncollectible accounts after all the necessary adjusting entries on December
31, 2022?
31, 2022?
127,480
60,000
113,800
117,400
Transcribed Image Text:The financial statements of Exo Corporation included the following:
December 31, 2021
3,675,000
81,000
December 31, 2022
Accounts receivable
Allowance for doubtful accounts
22,500,000
21,000,000
Sales on account
Cash collected from customers
Among the cash collections was the full recovery of an P80,000 receivable from Big Company, a customer whose account
had been written off as worthless late in 2021.
During 2022, it was necessary to write off uncollectible customers' accounts totaling P101,000.
On December 1, 2022, Bang Electronics, Inc., a customer, settled its account by issuing to Exo Corporation a 12%, six-
month note for P1,300,000.
At December 31, 2022, the accounts receivable included P504,000 past due accounts. After careful study of all past-due
accounts, the management estimated that the probable loss contained therein was 10%. In addition, 2% of the current
accounts receivable might prove uncollectible.
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