Activity 3

Accounting for Accounts Receivable & Notes Receivable

QUESTIONS

1. Define receivables & explain its the classification in the statement of financial position.

2. Explain the initial measurement of receivables.

3. Briefly explain the following:

a. FOB Destination

b. FOB Shipping point

c. Freight collect

d. Freight prepaid

4. Explain the two methods of recording account receivables and credit sales and the PFRS 15 application.

5. What are the two methods of accounting for bad debts? Which is in accordance with GAAP?

6. Explain the three methods of estimating doubtful accounts.

7. Explain the initial measurement of,

a. short-term notes receivable

b. interest bearing long-term notes

c. noninterest bearing note receivable

d. interest bearing below market rate long-term notes