On January 1, Year 2, Grande Company had a $69,000 balance in the Accounts Receivable account and a $2,500 balance in the Allowa

Question

3 years ago

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On January 1, Year 2, Grande Company had a $69,000 balance in the Accounts Receivable account and a $2,500 balance in the Allowa

nce for Doubtful Accounts account. During Year 2, Grande provided $180,000 of service on the account. The company collected $210,100 cash from accounts receivable. Uncollectible accounts are estimated to be 1% of sales on account.
Based on this information, the amount of cash flow from operating activities that would appear on the Year 2 statement of cash flows is _____.

Business

1 answer:

attashe74 [19] · Answer 1 · 2022-01-30T21:30:06+03:00

Answer:The amount of uncollectible accounts expense recognized on the Year 2 income statement is $1,800.

Explanation:The amount of uncollectible accounts expense recognized on the Year 2 income statement is $1,800 ($180,000 x 1%), which has been computed by multiplying the percentage of allowance for uncollectible account with the total on account sales.