Question
Cordova, Inc., reported the following receivables in its December 31, 2015, year-end balance sheet: Current assets: Accounts receivable, net of $47,000 in allowance for uncollectible
Cordova, Inc., reported the following receivables in its December 31, 2015, year-end balance sheet: Current assets: Accounts receivable, net of $47,000 in allowance for uncollectible accounts $379,000 Interest receivable 19,750 Notes receivable 350,000 Additional information: 1. The notes receivable account consists of two notes, a $100,000 note and a $250,000 note. The $100,000 note is dated October 31, 2015, with principal and interest payable on October 31, 2016. The $250,000 note is dated March 31, 2015, with principal and 10% interest payable on March 31, 2016. 2. During 2016, sales revenue totaled $2,070,000, $1,930,000 cash was collected from customers, and $36,000 in accounts receivable were written off. All sales are made on a credit basis. Bad debt expense is recorded at year-end by adjusting the allowance account to an amount equal to 8% of year-end accounts receivable. Required: 1. In addition to sales revenue, what revenue and expense amounts related to receivables will appear in Cordovas 2016 income statement?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started