Accounts receivable : Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business. Bad debt expense: Bad debt expense is an expense account. The amounts of loss incurred from extending credit to the customers are recorded as bad debt expense. In other words, the estimated uncollectible accounts receivable are known as bad debt expense. To compute: The amount of accounts receivable due from customers at the end of 2015 and 2014.

Question

The following is the data from Company X for 2016 and 2017. 2017 S900,000 2016 Net Sales $800,000 Receivables (less allowance for doubtful accounts) Beginning of period End of period $45,000 $60,000 $80,000 $60,000 Required) a) Compute the days' sales in receivables for December 31, 2016, and December 31, 2017, based on Days' sales in receivables - Average accounts receivable/(Sales/365) 2016 S 52,500.00 S 70,000.00 S 2,191.78 S 2,465.75 2017 Average accounts receivable Average daily sales Days sales in receivables b) Compute the accounts receivable turnover for the period ended December 31, 2016, and Decembe 23.95 28.39 Accounts receivable turnover = Sales/(Average accounts receivable)

Answer 1

Question

Chapter 7, Problem 7.5P

(1)

To determine

Accounts receivable:

Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business.

Bad debt expense:

Bad debt expense is an expense account. The amounts of loss incurred from extending credit to the customers are recorded as bad debt expense. In other words, the estimated uncollectible accounts receivable are known as bad debt expense.

To compute: The amount of accounts receivable due from customers at the end of 2015 and 2014.

(2)

To determine

To compute: The amount of Accounts Receivable Written-off during 2015.

(3)

To determine

To compute: The amount of Gross Sales.

(4)

To determine

The amount of cash collected from customers during the year, assuming that all sales are made on a credit basis.

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The following is the data from Company X for 2016 and 2017. 2017 S900,000 2016 Net Sales $800,000 Receivables (less allowance for doubtful accounts) Beginning of period End of period $45,000 $60,000 $80,000 $60,000 Required) a) Compute the days' sales in receivables for December 31, 2016, and December 31, 2017, based on Days' sales in receivables - Average accounts receivable/(Sales/365) 2016 S 52,500.00 S 70,000.00 S 2,191.78 S 2,465.75 2017 Average accounts receivable Average daily sales Days sales in receivables b) Compute the accounts receivable turnover for the period ended December 31, 2016, and Decembe 23.95 28.39 Accounts receivable turnover = Sales/(Average accounts receivable)

Q35 Dyl Pickle Inc. had credit sales of $15,700,000 last year and its days sales outstanding was DSO = 55 days. What was its average receivables balance, based on a 365-day year? $2,365,753 $1,041,909 $285,455 $2,804,795 $1,294,521

Days’ Sales in Receivables [LO2] A company has net income of $218,000, a profi tmargin of 8.70 percent, and an accounts receivable balance of $132,850. Assuming70 percent of sales are on credit, what is the company’s days’ sales in receivables?

Answer 2

Question

Chapter 7, Problem 7.5P

(1)

To determine

Accounts receivable:

Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business.

Bad debt expense:

Bad debt expense is an expense account. The amounts of loss incurred from extending credit to the customers are recorded as bad debt expense. In other words, the estimated uncollectible accounts receivable are known as bad debt expense.

To compute: The amount of accounts receivable due from customers at the end of 2015 and 2014.

(2)

To determine

To compute: The amount of Accounts Receivable Written-off during 2015.

(3)

To determine

To compute: The amount of Gross Sales.

(4)

To determine

The amount of cash collected from customers during the year, assuming that all sales are made on a credit basis.

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Answer 3

Question

Chapter 7, Problem 7.5P

(1)

To determine

Accounts receivable:

Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business.

Bad debt expense:

Bad debt expense is an expense account. The amounts of loss incurred from extending credit to the customers are recorded as bad debt expense. In other words, the estimated uncollectible accounts receivable are known as bad debt expense.

To compute: The amount of accounts receivable due from customers at the end of 2015 and 2014.

(2)

To determine

To compute: The amount of Accounts Receivable Written-off during 2015.

(3)

To determine

To compute: The amount of Gross Sales.

(4)

To determine

The amount of cash collected from customers during the year, assuming that all sales are made on a credit basis.

Expert Solution & Answer

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Answer 4

Question

Chapter 7, Problem 7.5P

(1)

To determine

Accounts receivable:

Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business.

Bad debt expense:

Bad debt expense is an expense account. The amounts of loss incurred from extending credit to the customers are recorded as bad debt expense. In other words, the estimated uncollectible accounts receivable are known as bad debt expense.

To compute: The amount of accounts receivable due from customers at the end of 2015 and 2014.

(2)

To determine

To compute: The amount of Accounts Receivable Written-off during 2015.

(3)

To determine

To compute: The amount of Gross Sales.

(4)

To determine

The amount of cash collected from customers during the year, assuming that all sales are made on a credit basis.

Expert Solution & Answer

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Answer 5

Chapter 7, Problem 7.5P

(1)

To determine

Accounts receivable:

Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business.

Bad debt expense:

Bad debt expense is an expense account. The amounts of loss incurred from extending credit to the customers are recorded as bad debt expense. In other words, the estimated uncollectible accounts receivable are known as bad debt expense.

To compute: The amount of accounts receivable due from customers at the end of 2015 and 2014.

(2)

To determine

To compute: The amount of Accounts Receivable Written-off during 2015.

(3)

To determine

To compute: The amount of Gross Sales.

(4)

To determine

The amount of cash collected from customers during the year, assuming that all sales are made on a credit basis.

Answer 6

Chapter 7, Problem 7.5P

(1)

To determine

Accounts receivable:

Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business.

Bad debt expense:

Bad debt expense is an expense account. The amounts of loss incurred from extending credit to the customers are recorded as bad debt expense. In other words, the estimated uncollectible accounts receivable are known as bad debt expense.

To compute: The amount of accounts receivable due from customers at the end of 2015 and 2014.

Answer 7

Chapter 7, Problem 7.5P

(1)

To determine

Accounts receivable:

Accounts receivable refers to the amounts to be received within a short period from customers upon the sale of goods and services on account. In other words, accounts receivable are amounts customers owe to the business. Accounts receivable is an asset of a business.

Bad debt expense:

Bad debt expense is an expense account. The amounts of loss incurred from extending credit to the customers are recorded as bad debt expense. In other words, the estimated uncollectible accounts receivable are known as bad debt expense.

To compute: The amount of accounts receivable due from customers at the end of 2015 and 2014.

Answer 8

(2)

To determine

To compute: The amount of Accounts Receivable Written-off during 2015.

Answer 9

(2)

To determine

To compute: The amount of Accounts Receivable Written-off during 2015.

Answer 10

(3)

To determine

To compute: The amount of Gross Sales.

Answer 11

(3)

To determine

To compute: The amount of Gross Sales.

Answer 12

(4)

To determine

The amount of cash collected from customers during the year, assuming that all sales are made on a credit basis.

Answer 13

(4)

To determine

The amount of cash collected from customers during the year, assuming that all sales are made on a credit basis.

Answer 14

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Ch. 7 - Prob. 7.1Q Ch. 7 - Prob. 7.2Q Ch. 7 - Prob. 7.3Q Ch. 7 - Prob. 7.4Q Ch. 7 - Prob. 7.5Q Ch. 7 - Prob. 7.6Q Ch. 7 - Distinguish between the gross and net methods of...Ch. 7 - Briefly explain the accounting treatment for sales...Ch. 7 - Explain the typical way companies account for...Ch. 7 - Briefly explain the difference between the income...

Solution Summary: The author explains the amount of accounts receivable due from customers at the end of 2015 and 2014, and the calculation of gross sales.

To compute: The amount of Accounts Receivable Written-off during 2015.

To compute: The amount of Gross Sales.

The amount of cash collected from customers during the year, assuming that all sales are made on a credit basis.

Chapter 7 Solutions