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Please help with this bad debt question. Thank you. Homework: Cash and Receivables Assignment Green Technologies is a leading global end-to-end technology provider, with a
Please help with this bad debt question. Thank you.
Homework: Cash and Receivables Assignment Green Technologies is a leading global end-to-end technology provider, with a portfolio of hardware, software and service solutions, In a recent annual report, the balance sheet included the following information ($ in millions): 2820 2819 Current assets: Receivables, less allowance of $274 in 2020 and $265 in 2019 $ 13,684 $ 13,571 In addition, the income statement reported sales revenue of $104,226 million for the current year, All sales are made on a credit basis. The statement of cash flows indicates that cash collected from customers during the current year was $103,868 million. There could have been significant recoveries of accounts receivable previously written off. Required: 1. Compute the following ($ in millions): a. The amount of bad debts written off by Green during 2020 (Hint Treat it as a plug in the gross accounts receivable account) b. The amount of bad debt expense that Green included in its income statement for 2020 (Hint Treat it as a plug in the allowance for uncollectible accounts) c. The approximate percentage that Green used to estimate bad debts for 2020, assuming that it used the income statement approach. 2. Suppose that Green had used the direct write-off method to account for bad debts. Compute the following ($ in millions): a. The accounts receivable information that would be included in the 2020 year-end balance sheet. b. The amount of bad debt expense that Green would include in its 2020 income statement. 1. ) a. Bad debts written off or reinstated b. Bad debt expense c. Income statement approach % 2.) 2020 2019 Current assets: Receivables Bad debt expenseStep by Step Solution
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