Solution:
The interest receivable should be shown separately as a current
asset ( It should not be deducted from notes receivable). The
allowance for doubtful accounts should be deducted from accounts
receivable.
Receivables on the Balance Sheet Identify any errors in the following partial balance sheet. Napa Vino...
Exercise 3-7 (Static) Balance sheet preparation; errors [LO3-2, 3-3] The following balance sheet for the Los Gatos Corporation was prepared by a recently hired accountant. In reviewing the statement you notice several errors. LOS GATOS CORPORATION Balance Sheet At December 31, 2021 Assets Cash $ 40,000 Accounts receivable 80,000 Inventory 55,000 Machinery (net) 120,000 Franchise (net) 30,000 Total assets $ 325,000 Liabilities and Shareholders’ Equity Accounts payable $ 50,000 Allowance for uncollectible accounts 5,000 Notes payable 55,000 Bonds payable 110,000...
when computing days' sales in inventory! Biscuss. P 6-11 A partial balance sheet and in partial balance sheet and income statement for King Corporation follow: KING CORPORATION Partial Balance Sheet Assets December 31, 2011 Current assets: $ 33,493 Cash 215,147 Marketable securities 255,000 Trade receivables, less allowance of $6,000 523,000 Inventories, LIFO 26,180 Prepaid expenses $1,052,820 Total current assets Liabilities Current liabilities: $ 103,689 Trade accounts payable 210,381 Notes payable (primarily to banks) and commercial paper 120,602 Accrued expenses and...
0. Allowance for Doubtful Accounts on the balance sheet: a is offset against total current assets. b. increases the cash realizable value of accounts receivable. c appears under the heading "Other Assets." d. is deducted from accounts receivable. or a company with significant uncollectible receivables, the direct write-off method is unsuitable because: A) it overstates liabilities on the balance sheet. B) it violates the matching principle. C) direct write-offs would be immaterial. D) it is not allowed for tax reasons....
0. Allowance for Doubtful Accounts on the balance sheet: a is offset against total current assets. b. increases the cash realizable value of accounts receivable. c appears under the heading "Other Assets." d. is deducted from accounts receivable. or a company with significant uncollectible receivables, the direct write-off method is unsuitable because: A) it overstates liabilities on the balance sheet. B) it violates the matching principle. C) direct write-offs would be immaterial. D) it is not allowed for tax reasons....
Exercise 3-7 Balance sheet preparation; errors [LO3-2, 3-3) The following balance sheet for the Los Gatos Corporation was prepared by a recently hired accountant. In reviewing the statement you notice several errors LOS GATOS CORPORATION Balance Sheet At December 31, 2018 AssetS Cash Accounts receivable Inventories Machinery (net) Franchise (net) $ 70,000 125,000 70,000 135,000 45, 000 $445,000 Total assets Liabilities and Shareholders' Equity Accounts payable $ 80,000 Allowance for uncollectible accounts 20,000 85,000 125,000 135,000 $445,000 Note payable Bonds...
Chamberlain Enterprises Inc. reported the following receivables in its December 31, 2021, year-end balance sheet: Current assets: Accounts receivable, net of $43,000 in allowance for uncollectible accounts Interest receivable Notes receivable $313,000 16, 10e 450, eee Additional Information: 1 The notes receivable account consists of two notes, a $95.000 note and a $355.000 note. The $95.000 note is dated October 31 2021 with principal and interest payable on October 31, 2022. The $355.000 note is dated June 30, 2021. with...
Chamberlain Enterprises Inc. reported the following receivables in its December 31, 2018, year-end balance sheet: Current assets: Accounts receivable, net of $27,000 in allowance for uncollectible accounts $ 233,000 Interest receivable 10,000 Notes receivable 290,000 Additional Information: The notes receivable account consists of two notes, a $60,000 note and a $230,000 note. The $60,000 note is dated October 31, 2018, with principal and interest payable on October 31, 2019. The $230,000 note is dated June 30, 2018, with principal and...
Chamberlain Enterprises Inc. reported the following receivables in its December 31, 2018, year-end balance sheet: Current assets: Accounts receivable, net of $38,000 in allowance for uncollectible accounts $ 288,000 Interest receivable 11,300 Notes receivable 400,000 Additional Information: 1.The notes receivable account consists of two notes, a $70,000 note and a $330,000 note. The $70,000 note is dated October 31, 2018, with principal and interest payable on October 31, 2019. The $330,000 note is dated June 30, 2018, with principal and...
Chamberlain Enterprises Inc. reported the following receivables in its December 31, 2018, year-end balance sheet: Current assets: Accounts receivable, net of $24,000 in allowance for uncollectible accounts $ 218,000 Interest receivable 6,800 Notes receivable 260,000 Additional Information: The notes receivable account consists of two notes, a $60,000 note and a $200,000 note. The $60,000 note is dated October 31, 2018, with principal and interest payable on October 31, 2019. The $200,000 note is dated June 30, 2018, with principal and...
Chamberlain Enterprises Inc. reported the following receivables in its December 31, 2021, year-end balance sheet: Current assets: Accounts receivable, net of $43,000 in allowance for uncollectible accounts Interest receivable Notes receivable $313,000 16, 10e 450, eee Additional Information: 1 The notes receivable account consists of two notes, a $95.000 note and a $355.000 note. The $95.000 note is dated October 31 2021 with principal and interest payable on October 31, 2022. The $355.000 note is dated June 30, 2021. with...