Suppose the following information was taken from the 2014 financial statements of FedEx Corporation, a major global transportati
2 answers:
Answer:
A/R TO 9.77
Days on Inventory 37
YES As it weight as almost half of the current assets of the company
Explanation:
The financial statement post the current year first and the last year in the secodn column therefore, the second colum is the year 2013 and my calculation will be based on that.
2014 2013
Accounts receivable (gross) $3,697 $4,835
Accounts receivable (net) 3,460 4,187
Allowance for doubtful accounts 237 648
Sales revenue 37,368 39,579
Total current assets 7,254 7,69
where:
Sales 37,368
beginning 4,187
ending 3,460
Avg. A/R 3823.5
A/R TO 9.77324441
Days on Inventory 37
3,460 / 7,254 = 0.4769
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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
