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3 years ago

Gekko, Inc. reported the following balances (after adjustment) at the end of 2008 and 2007.

Business

1 answer:

nevsk [136]3 years ago

6 0

Answer:

Correct answer is D, P3,900

Explanation:

Begging Allowance for doubtful account is P1,500 (96,000 - 94,500). Ending balance of Allowance for doubtful account is P3,000 (P108,000 -P105,000). We can now work back the provision for doubtful accounts that the company has made during 2008.

Beginning P1,500

Add:

Collection of written off accounts 800

Total P2,300

Less:

Written off 3,200

Total (P900)

Therefore, in order for the company to have an ending inventory of P3,000, They must have set up a provision for doubtful accounts in the amount of P3,900. Attached herewith is the T-account of allowance for doubtful accounts

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3 years ago

Which type of cover letter would the above excerpt come from?

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Answer:

c. credit to notes payable

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