Description
i am stuck on this problem. here is a pic of the problem
any help would be appreciated
Explanation & Answer
Jersey Company
Beginning balance of Accounts receivable $30,000
Add : Sale on account during the year 170,000
Total $200,000
Less: Write-off accounts receivable $1,400
Ending balance of Accounts Receivable 34,000 35,400
Cash collected $164,600
Uncollectible accounts expense:
Ending balance of allowance for doubtful accounts $1,700
Add Writes-off amount 1,400
Total $3,100
Less Beginning balance of allowance for doubtful accounts 1,800
Uncollectible Accounts Expense $1,300
Ending balance of Accounts Receivable $34,000
Less Allowance for Doubtful Accounts 1,700
Net realizable value of Accounts Receivable $32,300
Interest revenue recognized for the period = $40,000*6%
= $2,400
Beginning balance of Interest Receivable $1,200
Add Interest income for the year 2,400
Total Interest Receivable $3,600
Ending balance of Interest Receivable 3,600
Nothing cash collection during the year 0
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