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Mrrafil [7]
3 years ago
5

Hancock Medical Supply Co., which had no beginning balance in its Accounts Receivable and Allowance for Doubtful Accounts, earne

d $86,000 of revenue on account during Year 1. During Year 1, Hancock collected $68,200 of cash from its receivables accounts. The company estimates that it will be unable to collect 1% of revenue on account. The amount of net realizable value of receivables on the December 31, Year 1 balance sheet would be:a. $17, 118. b. $16, 940. c. $17, 800. d. $17, 622.
Business
2 answers:
olganol [36]3 years ago
8 0

Answer:

b. $ 16,940

Explanation:

First we need to determine the allowance for uncollectible accounts to be made for the year.

Allowance for uncollectible revenue is 1 % of revenue on account.

Revenue on  account is $ 86,000 so the allowance for uncollectible accounts is $ 86,000 * 1 %= $ 860

The gross receivable value is amount of revenue on credit less the collections

Revenue on credit                                                                       $ 86,000

Less: collections on account                                                       <u>$ 68,200</u>  

Gross receivables                                                                        $  17,800

Less Allowance for uncollectible accounts                               <u> $(      860)</u>

Net Realizable value of receivables                                        <u> </u><u>$   16,940</u>                                      

djverab [1.8K]3 years ago
3 0

Answer:

b. $16, 940

Explanation:

The allowance for bad debt is an account used to estimate how much of the receivables recorded by an entity may become uncollectible.

However, once debts are determined to have gone bad and have not been provided for previously, the entries to be posted will be between the bad debt and account receivables.

Given that Revenue earned was $86,000 on account and cash collected was $68,200

Then account receivables balance

= $86,000 - $68,200

= $17,800

If the company estimates that it will be unable to collect 1% of revenue on account, this amounts to

= 1% of $86,000 = $860

The amount of net realizable value of receivables on the December 31, Year 1 balance sheet would be

= $17,800 - $860

=  $16,940

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The act of arranging tasks in order of importance or timeliness is called
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3 years ago
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A. How much would you pay for a Treasury bill that matures in 182 days and pays $10,000 if you require a 1.8% discount rate?
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Answer: $9909

Explanation:

Let the amount that will be paid be represented by y. The question can now be solved as:

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$ 1,035,200 Total Net Sales       $ 647  1.600  

-$ 352,000 Variable Cost          $ 220  

-$ 64,000 Depreciation Expenses  

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$ 181,200 Segment Margin  

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