Peters Plants sells artificial plants for indoor and outdoor use. The company is owned and managed by Peter Petersen.

Credit Policy

Terms and conditions -Standard credit terms are net 30 days. At the end of the month an aged receivables report and overdue accounts are reviewed. Monthly statements are issued at the end of the month.

Collection Procedures

The following steps are taken regarding the collection of monies owing:

0-30 days current:Invoice/s sent to customer with month end statement

31-60 days overdue account:Overdue sticker sent with next statement

61-90 days overdue account:Phone call informing customer credit facility will be put on hold

91 + days overdue account:If a customer's debt is more than $150 a letter informing the customer their account will be turned over to a collection agency if payment is not received within 14 days.

Customer Delinquency

A debt that is 90 + days overdue and less than $150 will be written off as a bad debt.

Tip: the specific answers to all of the following questions for 9(f) may not be completely found in the textbook. Use your learning and understanding of recording and administering credit sales and dealing with credit customers to arrive at your answers. Feel free to research other sources to assist you.

Required:

9f(i)Using the information provided in Peters Plants Aged Receivable report as at 31 March 2018, complete an Overdue Accounts Review.

Aged Receivables(Detail)

31 March 2018

Customer/ Invoice No.

Date

Total Due

0 - 30

31 - 60

61 - 90

91 +

Rosie Rose

000123

8/1/2018

$1200.00

$1200.00

Total

$1200.00

$0.00

$0.00

$1200.00

$0.00

Cam Camelia

000345

18/2/2018

$670.00

$670.00

Total

$670.00

$0.00

$670.00

$0.00

$0.00

Leonard Lilly

000567

5/12/2017

$400.00

$400.00

Total

$400.00

$0.00

$0.00

$0.00

$400.00

Grand Total

Ageing Percent

$2270.00

$0.00

0.0%

$670.00

29.5%

$1200.00

52.9%

$400.00

17.6%

Overdue Accounts Review - Peters Plants

Customer

Invoice Number

Days Overdue

Amount Owing

Previous Communications

9f(ii)Using the information from Peters Plants' Credit Policy and Aged Receivables report as at 31 March 2018, what steps would you take regarding the collection of monies outstanding as at 31 March 2018?

Customer

Collection Procedures

9f(iii)Who would you distribute these reports to?

9f(iv)Where would these reports be filed?

9(g)In order to pay the invoices that have been received from your suppliers, what checks would you first undertake on these supplier invoices before making payment?

Tip: the specific answer to this question may not be completely found in the textbook. Use your learning and understanding of recording and administering credit purchases to arrive at your answers. Feel free to research other sources to assist you.