AP1-20 introduced Lydia Cravette and her florist shop, Scents Unlimited Ltd. At the end of May, the

Question:

AP1-20 introduced Lydia Cravette and her florist shop, Scents Unlimited Ltd. At the end of May, the following items were in her records:

Required:
a. Identify each of the items in her records as an asset, liability, or shareholders€™ equity item.
b. Prepare a statement of financial position for Scents Unlimited Ltd. at the end of May.
c. Lydia Cravette does not have accounts receivable in her records. Explain why it is unlikely that she will record accounts receivable. Under what business circumstances would it be necessary for her to record accounts receivable?

Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...