BACK NEXT Accounting, Analysis, and Principles The Sarasota Pub provides catering services to local businesses. The following information was available for The Sarasota Pub for the years ended December 31, 2019 and 2020. 7 7 December December 31, 2019 31, 2020 Cash $ 1,870 $ 1,720 Accounts receivable 45,800 Allowance for doubtful accounts 570 Other current assets 8,540 7,950 Current liabilities 37,900 44,700 Total credit sales 205,000 254,000 Collections on accounts receivable 191,000 230,000 Sarasota management is preparing for a meeting with its bank concerning renewal of a loan and has collected the following information related to the above balances. 1. The cash reported at December 31, 2020, reflects the following items: petty cash $1,600 and postage stamps $120. The other current assets balance at 2. On November 30, 2020, Sarasota agreed to accept a 6-month, $5,130 note bearing 12% Interest, payable at maturity, from a major client in settlement of a $5,130 bill. The above balances do not reflect this transaction. 3. Sarasota factored some accounts receivable at the end of 2020. It transferred accounts totaling $10,000 to Final Factor, Inc. with recourse. Final Factor will receive the collections from Sarasota's customers and will retain 2% of the balances. Final Factor assesses Sarasota a finance charge of 3% on this transfer. The fair value of the recourse liability is $390. However, management has determined that the amount due from the factor and the fair value of the resource obligation have not been recorded, and neither are included in the balances above. 4. Sarasota charged off uncollectible accounts with balances of $1,540. On the basis of the latest available information, the 2020 provision for bad debts is estimated to be 2.5% of accounts receivable. Based on the above transactions, determine the balance for (1) Accounts Receivable and (2) Allowance for Doubtful Accounts at December 31, 2020. (Round answers to o decimal places, e.g. 125.) Accounts receivable ending balance $ Allowance for doubtful ending balance $ Prepare the current assets section of The Sarasota Pub's balance sheet at December 31, 2020. (Round answers to 0 decimal places, e.g. 125.) THE SARASOTA PUB Balance Sheet 0 LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT Compute Sarasota's current ratio and accounts receivable turnover for December 31, 2020. The accounts receivable turnover in 2019 was 4.37. (Round answers to 2 decimal places, e.g. 52.75.) Current ratio :1 Accounts receivable turnover times Click If you would like to Show Work for this question: Open Show Work LINK TO TEXT LINK TO TEXT LINK TO TEXT LINK TO TEXT
