Question

Accounting, Analysis, and Principles The Sheffield Pub provides catering services to local businesses. The following information was available for The Sheffield Pub for the years ended December 31, 2019 and 2020. December 31, 2020 $ 1,690 Cash Accounts receivable Allowance for doubtful accounts Other current assets Current liabilities Total credit sales Collections on accounts receivable December 31, 2019 $ 2,130 46,200 580 8,260 38,900 201,000 190,000 7,860 44,300 250,000 228,000 Sheffield management is preparing for a meeting with its bank concerning renewal of a loan and has collected the following information related to the above balances. 1. The cash reported at December 31, 2020, reflects the following items: petty cash $1,580 and postage stamps $110. The other current assets balance at December 31, 2020, includes the checking account balance of $3,740. 2. On November 30, 2020, Sheffield agreed to accept a 6-month, $5,170 note bearing 12% interest, payable at maturity, from a major client in settlement of a $5,170 bill. The above balances do not reflect this transaction. 3. Sheffield factored some accounts receivable at the end of 2020. It transferred accounts totaling $10,000 to Final Factor, Inc. with recourse. Final Factor will receive the collections from Sheffield's customers and will retain 2% of the balances. Final Factor assesses Sheffield a finance charge of 3% on this transfer. The fair value of the recourse liability is $410. However, management has determined that the amount due from the factor and the fair value of the resource obligation have not been recorded, and neither are included in the balances above. 4. Sheffield charged off uncollectible accounts with balances of $1,420. On the basis of the latest available information, the 2020 provision for bad debts is estimated to be 2.5% of accounts receivable. este de Sheffield a finance charge of 3% on this transfer.

Based on the above transactions, determine the balance for (1) Accounts Receivable and (2) Allowance for Doubtful Accounts at December 31, 2020. (Round answers to 0 decimal places, e.g. 125.)

Accounts receivable ending balance		$
Allowance for doubtful ending balance		$

Answer 1

Above Question asked for closing Account receivable Balance and closing Doubtful debt allowance balance . Please see answer below .

The Sheffield Pub provides catering service to Local Business
Balance Sheet
	31stDec 2019$	31stDec 2020 $
Cash	2,130
Account receivable	46,200
Allowance for Doubtful Debt	580
Other current Assets	8,260	7,860
Current Liability	38,900	44,300
Total Credit Sales	2,01,000	2,50,000
Collection on account receivable	1,90,000	2,28,000
Important Point to note that
Sheffield fator some accounts receivable at the end of 2022
It transfer $ 100000 to Final Factor with recourse
As per contract , will retain 2% of the balance
		Amnt($)
Account Receivable- Dec 31,2019		46,200
Credit Sales		2,50,000
Less- collection		2,28,000
Less - factor base as discussed above		10,000
Less - Charged off uncollectable account		1,420
Account Receivable- Dec 31,2020		56,780
Now determined Closng balance of Doubtful debt allowance
As per Question , doubtful debt allowance @ 2.5% Account receivable
Closing Balance of Accoutn receivable		56,780
Doubtful debt allowance - 2.5% on $ 56780		1,420
	Amnt($)
Allowance for Doubtful Debt- Opening Balance	580
Less - Charged off Uncollectable	1,420
Bad Debt Expenses	2,260	( Balancing Number)
Allowance for Doubtful Debt- Closing Balance( as calculated above)	1,420