Use the following items taken from the financial statements of the Postal Service for the year ending December 31, 2018 to answer questions: Accounts payable ..............................................................$10,000 Accounts receivable ............................................................11,000 Accumulated depreciation – equipment ..........................28,000 Advertising expense ............................................................21,000 Cash ......................................................................................14,000 Owner’s capital (1/1/18) ...................................................105,000 Owner’s drawings ...............................................................14,000 Depreciation expense ........................................................12,000 Insurance expense ...............................................................3,000 Note payable, due 6/30/19 ..................................................5,000 Prepaid insurance (6 - month policy) .................................6,000 Rent expense ......................................................................17,000 Salaries and wages expense .............................................32,000 Service revenue ................................................................125,000 Supplies/Inventory ...............................................................4,000 Supplies expense .................................................................6,000 Equipment (Long-term) ..................................................210,000 What are the Current Assets of the Postal Service at December 31, 2018? (A)15,000 (B)35,000 (C) 120,000 (D) 135,000 What are the total current Liabilities of the Postal Service at December 31, 2018? (A) 15,000 (B)21,000 (C) 35,000 (D) 125,000
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.
Use the following items taken from the financial statements of the Postal Service for the year ending December 31, 2018 to answer questions:
Accounts payable ..............................................................$10,000
Advertising expense ............................................................21,000
Cash ......................................................................................14,000
Owner’s capital (1/1/18) ...................................................105,000
Owner’s drawings ...............................................................14,000
Depreciation expense ........................................................12,000
Insurance expense ...............................................................3,000
Note payable, due 6/30/19 ..................................................5,000
Prepaid insurance (6 - month policy) .................................6,000
Rent expense ......................................................................17,000
Salaries and wages expense .............................................32,000
Service revenue ................................................................125,000
Supplies/Inventory ...............................................................4,000
Supplies expense .................................................................6,000
Equipment (Long-term) ..................................................210,000
What are the Current Assets of the Postal Service at December 31, 2018?
(A)15,000 (B)35,000 (C) 120,000 (D) 135,000
What are the total current Liabilities of the Postal Service at December 31, 2018?
(A) 15,000 (B)21,000 (C) 35,000 (D) 125,000
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
