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Tems11 [23]
4 years ago
14

The Miller Company earned $133,000 of revenue on account during Year 2. There was no beginning balance in the accounts receivabl

e and allowance accounts. During Year 2, Miller collected $87,000 of cash from its receivables accounts. The company estimates that it will be unable to collect 3% of its sales on account. The net realizable value of Miller's receivables at the end of Year 2 was:
Business
1 answer:
horsena [70]4 years ago
4 0

Answer:

The net realizable value of Miller's receivables at the end of Year 2 was:  $42,010

Explanation:

Open a Trade Receivable Account as follows :

Debits :

Revenue $133,000

Totals      $133,000

Credits:

Cash        $87,000

Balance   $46,000

Totals      $133,000

Note that Allowance for Doubtful debts is estimated at 3% of the Company`s Sales on Account

Allowance for Doubtful debts = $133,000 × 3%

                                                 = $ 3, 990

<u>Net realizable value of Miller's receivables</u>

Trade Receivable Balance                $46,000

Less Allowance for Doubtful Debts    $3,990

Trade Receivables                              $42,010

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Bob and mary are financing $180,500 for a new home. their lender will approve an interest rate of 5% if bob and mary pay two dis
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Bob and mary are financing $180,500 for a new home. their lender will approve an interest rate of 5% if bob and mary pay two discount points at closing. Cost them is $3,610.

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4 0
1 year ago
Glenn Company purchased merchandise inventory with an invoice price of $9,000 and credit terms of 2/10, n/30. What is the net co
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Answer:

The correct answer is B

Explanation:

The net cost of goods is computed as if the paid in the discounting period:

Net Cost of goods = Inventory cost - (Inventory cost × Discounting percentage)

where

Inventory cost is $9,000

Discounting percentage is 2%

Putting the values above:

Net Cost of goods = $9,000 - ($9,000 × 2%)

Net Cost of goods = $9,000 - $180

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Therefore, the amount of $8,280 will be paid by the company if paid within the discounting period and avail the discount of $180.

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4 years ago
Flanders Company purchased an asset on January 1, 2021 for $60,000. The asset has an estimated salvage value of $3,000. Its esti
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Answer:

$14,250

Explanation:

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Annual depreciation = $57,000 / 8

Annual depreciation = $7,125

Accumulated dep. at December 31, 2022 = $7,125 * 2

Accumulated dep. at December 31, 2022 = $14,250

So, the balance in accumulated depreciation using the straight-line method at December 31, 2022 is $14,250.

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