An entity began operations on January 1, 2013. From 2013 to 2015, the entity provided for doubtful accounts based on 5% of annual credit sales. On January 1, 2016, the entity changed the method of determining the allowance for doubtful accounts using an aging schedule. In addition, the entity writes off all accounts receivable that are over 1 year old. The following information relates to the years ended December 31, 2013, 2014, 2015 and 2016: 2016 2015 2014 2013 Credit sales 15,000,000 9,500,000 8,000,000 6,000,000 Collections excluding recovery 11,700,000 8,200,000 6,700,000 4,500,000 Accounts written off during year 200.000 120,000 80,000 None Recovery of accounts written off 90,000 40,000 25,000 None Days Account Outstanding Amount Probability of Collection Less than 16 days 3,000,000 98% Between 16 and 50 days 1,500,000 80% Between 51 and 100 days 1,200,000 75% Between 101 and 200 days 0,000 50% Between 201 and 365 days 400,000 20% Over 365 days - to be written off 100,000 0% 6. What was the allowance for doubtful accounts on January 1, 2016? a. 1,175,000 b. 1.040,000 C. 1,240,000 d 975,000 7. What amount should be reported as allowance for doubtful accounts on December 31, 2016? a. 1,380,000 b. 1,480,000 C. 2,420,000 d 1.060,000 What amount should be reported as doubtful accounts expense for 2016? a. 550,000 b. 750.000 C. 450,000 A 200.000 9 What is the net realizable value of accounts receivable on December 31, 2016? a. 6,900,000 7,000,000 5.520,000 5.620,000 10. Geary Co. assigned P 400,000 of accounts receivable to Kwik Finance Co. as security for a loan of p 335,000. Kwik charged a 2% commission on the amount of the loan; the interest rate on the note was 10%. During the first month, Geary collected P 110,000 on assigned accounts after deducting P 380 of discounts. Geary accepted returns worth p 1,350 and wrote off assigned accounts totaling p 2,980. The amount of cash Geary received from Kwik at the time of the transfer was P301,500 P327,000 P328,300 P335,000