During 2021, Hitchcock Inc. had sales on account of RM176,000, cash sales of RM72,000, and collections onaccount of RMI12,000. In addition, they collected RMI,950 which had been written off as uncollectible in 2020.As a result of these transactions, the change in the accounts receivable balance indicates aO A. RM136,000 increase.B. RM62,050 increase.O C. RM64,000 increase.D. RM134,050 increase. In 2021, the Dugan Co. had net credit sales of RM750,000. On January 1, 2021, Allowance for Doubtful Accountshad a credit balance of RM16,000. During 2021, RM30,000 of uncollectible accounts receivable were writtenoff. Past experience indicates that the allowance should be 10% of the balance in receivables (percentage ofreceivable basis). If the accounts receivable balance at December 31 was RM200,000, what is the requiredadjustment to the Allowance for Doubtful Accounts at December 31, 2021?O A. RM36,000O B. RM20,000C. RM34,000O D. RM30,000

Solution: Change in Accounts receivable = Total sales - collections = (176000 + 72000) - 112000 =…

uring 2021, Hitchcock Inc. had sales on account of RM176,000, cash sales of RM72,000, and collections ccount of RM112,000. In addition, they collected RM1,950 which had been written off as uncollectible in sa result of these transactions, the change in the accounts receivable balance indicates a O A. RM136,000 increase. O B. RM62,050 increase.

uring 2021, Hitchcock Inc. had sales on account of RM176,000, cash sales of RM72,000, and collections ccount of RM112,000. In addition, they collected RM1,950 which had been written off as uncollectible in sa result of these transactions, the change in the accounts receivable balance indicates a O A. RM136,000 increase. O B. RM62,050 increase.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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