1 ACC 210 Accounting Concept II Spring Semester 2022 2/2 Question 1 ABC Limited uses the allowance method to account for the uncollectible accounts receivable. The accounting policy is to relate the allowance for doubtful debts to the age of debts outstanding. The Balance Sheet as at January 1 2021 included a credit balance of $630 in the allowance for doubtful debts Account. The company's accounts for the year ended December 31 2021 are now being prepared. The debts outstanding at December 31 202 and the required allowance for doubtful debts are as follows: Debts outstanding Amount Allowance for doubtful debts $ % 0 day - 30 days 44,000 1.5 31 days - 60 days 20,000 2.5 61 days - 90 days 8,000 4.0 Over 91 days 3,000 5.0 75,000 Required: a) Prepare the allowance for doubtful debts account for the year ended December 31 2021. b) Show the extracts of the Accounts Receivable in the Balance Sheet of ABC Limited as at December 31 2021. 1 (50 marks) Question 2 Copper Explorations recently acquired the rights to mine a new site. Equipment and a truck were purchased to begin the mining operations at the site. Details of the assets for mining are as follows: Assets Mineral rights Equipment Truck Date of Purchase 1st March 2020 1st March 2020 1st March 2020 Cost ($) 62,400 244,800 0 0 Residual Value ($) Estimated useful life 4 years 4 years 95,400 0 4 years Copper's year-end is December 31 and it uses the straight-line method for all mining including intangibles. Required: a) Record the amortization and depreciation at December 31, 2020, on the mining assets, including the mineral rights. b) Assume the mine was closed on October 31, 2023, and all the assets were scrapped with zero residual value. Record the disposal of all the 3 pieces of assets. *********END OF ASSIGNMENT 1********* (50 marks) (Total: 100 marks)