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Journal Entry-metlock Company | |||
S. No. | Accounts Titles and Explanations | Debit | Credit |
1 | No entry | ||
2 | Accounts Receivables | 106,000 | |
Sales | 106,000 | ||
To Record Sales made on Account | |||
3 | Cash | 82,500 | |
Accounts Receivables | 82,500 | ||
To Record Collection Made |
Acccount receivable Turnover=Credit sales / Average receivable |
Average receivable = (Beginning Receivable + Ending Receivable)/2 |
( 23200+ ( 23200+106000-82500))/2 |
$34950/2=17475 |
Account Receivable Turnover= $106000/17475=6.07 times |
Day to Collect account receivable = 365/ Account receivable turnover ratio |
=365/6.07=60.13 days |
Exercise 7-21 Presented below is information for Metlock Company. 1. Beginning-of-the-year Accounts Rece...
Brief Exercise 7-10 Sheridan Incorporated factored $163,900 of accounts receivable with Skysong Factors Inc. on a without-recourse basis. Skysong assesses a 2% finance charge of the amount of accounts receivable and retains an amount equal to 6% of accounts receivable for possible adjustments. Prepare the journal entry for Sheridan Incorporated and Skysong Factors to record the factoring of the accounts receivable to Skysong. (If no entry is required, select "No Entry" for the account titles and enter 0 for the...
Exercise 7-21 Presented below is information for Ayayai Company 1. Beginning-of-the-year Accounts Receivable balance was $19,800 2. Net sales (all on account) for the year were $109,400. Ayayai does not offer cash discounts. 3. Collections on accounts receivable during the year were $88,300 Ayayai is planning to factor some accounts receivable at the end of the year. Accounts totaling $14,100 will be transferred to Credit Factors, Inc. with recourse. Credit Factors will retain 6% of the balances for probable adjustments...
Exercise 7-8 At the end of 2017, Headland Company has accounts receivable of $868,800 and an allowance for doubtful accounts of $49,900. On January 16, 2018, Headland Company determined that its receivable from Ramirez Company of $7,190 will not be collected, and management authorized its write-off. Prepare the journal entry for Headland Company to write off the Ramirez receivable. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles...
Exercise 7-16 The trial balance before adjustment for Teal Company shows the following balances. Dr. Cr. Accounts Receivable $84,800 Allowance for Doubtful Accounts 2,420 Sales Revenue $434,200 Using the data above, give the journal entries required to record each of the following cases. (Each situation is independent.) 1. To obtain additional cash, Teal factors without recourse $29,700 of accounts receivable with Stills Finance. The finance charge is 11% of the amount factored. 2. To obtain a 1-year loan of $57,600,...
Brief Exercise 7-8 Tony Acrobats lent $25,972 to Donaldson, Inc., accepting Donaldson’s 2-year, $32,000, zero-interest-bearing note. The implied interest rate is 11%. Prepare Tony’s journal entries for the initial transaction, recognition of interest each year, and the collection of $32,000 at maturity. (Round answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do...
Brief Exercise 7-2 Cullumber Co. uses the gross method to record sales made on credit. On June 1, 2017, it made sales of $67,400 with terms 3/15, n/45. On June 12, 2017, Cullumber received full payment for the June 1 sale. Prepare the required journal entries for Cullumber Co. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not...
On April 1, 2020, Wildhorse Company assigns $549,400 of its accounts receivable to the Third National Bank as collateral for a $301,600 loan due July 1, 2020. The assignment agreement calls for Wildhorse to continue to collect the receivables. Third National Bank assesses a finance charge of 3% of the accounts receivable, and interest on the loan is 10% (a realistic rate of interest for a note of this type). Collapse question part (a) Partially correct answer. Your answer is...
Problem 7-5 Presented below is information related to the Accounts Receivable accounts of Blossom Inc. during the current year 2017. 1. An aging schedule of the accounts receivable as of December 31, 2017, is as follows. Age Net Debit Balance % to Be Applied after Correction Is Made Under 60 days $171,900 1% 60–90 days 135,300 3% 91–120 days 39,500 * 5% Over 120 days 22,800 $3,700 definitely uncollectible; estimated remainder uncollectible is 23% $369,500 *The $3,500 write-off of receivables...
Problem 7-6 The balance sheet of Ivanhoe Company at December 31, 2016, includes the following. Notes receivable $51,200 Accounts receivable 195,600 Less: Allowance for doubtful accounts 24,600 $222,200 Transactions in 2017 include the following. 1. Accounts receivable of $151,300 were collected including accounts of $67,500 on which 4% sales discounts were allowed. 2. $5,670 was received in payment of an account which was written off the books as worthless in 2016. 3. Customer accounts of $24,800 were written off during...
Assume that Tamarisk Company has recently fallen into financial difficulties. By reviewing all available evidence on December 31, 2017, one of Tamarisk’s creditors, the National American Bank, determined that Tamarisk would pay back only 65% of the principal at maturity. As a result, the bank decided that the loan was impaired. The loss is estimated to be $274,900. What entry should National American Bank make to record this loss? (If no entry is required, select "No Entry" for the account...