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Excerpts from Pekola Companys annual report are provided below: (In millions) Income Statement 2014 2013 Revenues (all on account) $17,154 $15,998 Net income 6,606 2,296
Excerpts from Pekola Companys annual report are provided below: (In millions) Income Statement 2014 2013 Revenues (all on account) $17,154 $15,998 Net income 6,606 2,296 Balance Sheet Current Assets: Receivables, less allowance for uncollectibles of $338 and $308, respectively $ 3,052 $ 3,078 Footnotes Provision for uncollectibles $ 385 $ 355 5-1. Are estimated uncollectibles increasing or decreasing as percentage of revenues? 5-2. What is meant by provision for uncollectibles? Why is this reported in the notes? 5-3. What amount of write-offs occurred during 2014? (remember the handy household hints for solving almost any weird accounting problem) 5-4. What was the cash collected on accounts receivables during 2014? (are you interested in gross or net receivables for this question???) 5-5. What would you do with the provision for uncollectibles when preparing the statement of cash flows (indirect)? Why
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