Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please just answer 4,5,6 During 2019 the following selected summary transactions occurred for Zoff Ltd: a) Sales, $50,000,000 - of which 90% were on account,

image text in transcribed

image text in transcribed

Please just answer 4,5,6

During 2019 the following selected summary transactions occurred for Zoff Ltd: a) Sales, $50,000,000 - of which 90% were on account, terms net 30. b) Sales returns and allowances, $500,000 - 10% related to cash sales, and 90% related to sales on account. c) Cash collections of $42,000,000 from account receivable customers. d) Write-offs of account receivable deemed uncollectible, $1,100,000. e) Cash recoveries of account receivable previously written off, $60,000. Additional information: Percentage of credit sale loss for fiscal 2019: 2.5% Account receivable balance, December 31, 2018: $7,000,000. AFDA balance: As at December 31, 2018... $140,000 Required: [Show all your calculations to receive full points) 1. Prepare journal entries for summary transactions a) to e), above. (8 points) 4. Compute the Company's Gross Profit for the year ended December 31, 2019. Assume COGS is $29,000,000. [3 points] 5. Evaluate Zoff's Receivables Turnover Ratio (3 points) 6. If Zoff wrote-off uncollectible receivables totaling $1,000,000 on during the year, would the Gross Profit and Receivables Turnover Ratio you calculated in Requirements 3 and 4 be different? Explain your answers (no calculation is required). (4 points]

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing And Assurance Services

Authors: Timothy J Louwers, Robert J. Ramsay, David Sinason, Jerry R Strawser

1st Edition

0072954442, 9780072954449

More Books

Students also viewed these Accounting questions

Question

Describe a typical technical skills training program

Answered: 1 week ago