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Answer 1 a 2 b 3 c 4 b 5 d 6 a problem 4 presented

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Answer:1.A2.B3.C4.B5.D6.AProblem 4Presented below are unaudited balances of selected accounts of MARJORIE COMPANY as ofDecember 31, 2006:Unaudited Balances, 12/31/06Selected AccountsDebitCreditCashP500,000Accounts receivable1,300,000Allowance for doubtful accounts8,0004Downloaded by Kimmy Montero (kimmyyyyy[email protected])lOMoARcPSD|13955682
Net salesP 6,750,000Additional information are as follows:a.Goods amounting to P50,000 were invoiced for the accounts of Joy Store & Co.,recorded on January 2, 2007 with terms of net, 60 days, FOB shipping point.The goodswere shipped to Variety Store on December 30, 2006.b.The bank returned on December 29, 2006, a customer’s check for P5,000 marked“DAIF”, but no entry was made.c.MARJORIE COMPANY estimates that allowance for uncollectible accounts should be oneand one-half percent (1½%) of the accounts receivable balance as of year-end.Noprovision has yet been made for 2006.Questions1.What is the adjusted balance of Accounts Receivable on December 31, 2006?
2.What is the adjusted balance of Allowance for doubtful accounts on December 31, 2006?
3.What is the adjusted amount of 2006 Bad Debts Expense?Solution
Problem 5During December, 2006, the Accounts Receivable controlling account on the books ofFERNANDEZ COMPANY showed one debit posting and two credit postings.The debitrepresents receivables from December sales, P780,000.One credit was for P470,400, madea result of cash collections on November and December receivables; the second credit wasan adjustment for estimated uncollectibles, P90,000.The December 31 balance wasP270,000.When receivables were collected, the bookkeeper credited Accounts Receivables for the cashcollected.All customers who paid their accounts during December took advantage of the2% cash discount.As of December 1, debit balance in customers’ subsidiary accounts totaled P177,000.Anadjustment for estimated doubtful accounts of P18,000 had been posted to the AccountsReceivable controlling account at the end of 2002, and no write-offs were recorded during2006.In addition, a number of customers had overpaid their accounts, and as a result,some of the customers’ subsidiary accounts had credit balances on December 1.No5Downloaded by Kimmy Montero ([email protected])

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Term
Fall
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Tags
Doubtful Accounts, Accounts Receivables, Kimmy Montero

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