Mosaic’s Company balance sheet at December 31, 2018, reported the following: Accounts receivable...........................................$2,500,000 Allowance for uncollectible accounts...................$66,600 The following are the transactions to be taken into consideration for 2019: a. Total credit sales for 2019 were $3,600,000. b. 2% of sales were estimated to be uncollectible. c. The company received cash payments on account during 2019 for $1,000,000 d. Accounts receivable identified to be uncollectible totaled $94,000. e. December 31, 2019, aging of receivables indicates that $75,000 of the receivables is uncollectible. Requirements: 1. Prepare a Balance Sheet extract clearly showing the net realizable value of the receivables as at December 31, 2018? 2. Prepare the journal entries for the company’s 2019 transactions. 3. Prepare the Accounts receivable and the Allowance for uncollectible Accounts T-accounts based on the information presented above. (Note: The opening balances and the transactions from the journal entries must be recorded in their respective accounts) 4. Prepare a Balance Sheet extract clearly showing the net realizable value of receivables as at December 31, 2019? (Show workings)
Mosaic’s Company balance sheet at December 31, 2018, reported the
following:
Allowance for uncollectible accounts...................$66,600
The following are the transactions to be taken into consideration for 2019:
a. Total credit sales for 2019 were $3,600,000.
b. 2% of sales were estimated to be uncollectible.
c. The company received cash payments on account during 2019 for $1,000,000
d. Accounts receivable identified to be uncollectible totaled $94,000.
e. December 31, 2019, aging of receivables indicates that $75,000 of the receivables
is uncollectible.
Requirements:
1. Prepare a Balance Sheet extract clearly showing the net realizable value of the
receivables as at December 31, 2018?
2. Prepare the
3. Prepare the Accounts receivable and the Allowance for uncollectible Accounts T-accounts based on the information presented above. (Note: The opening balances
and the transactions from the journal entries must be recorded in their
respective accounts)
4. Prepare a Balance Sheet extract clearly showing the net realizable value of receivables
as at December 31, 2019? (Show workings)
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 8 images
