Question
Santan Company estimates its bad debt expense to be 3% of net sales. The companys unadjusted trial balance at December 31, 2017 included the following
Santan Company estimates its bad debt expense to be 3% of net sales. The companys unadjusted trial balance at December 31, 2017 included the following accounts: Debit Credit Allowance for bad debts P8, 000 Sales 2, 600, 000 Sales Returns and allowances P 45,000
1. What is the bad debt expense?
On December 1, 2017, Rose Company sold it accounts receivable (net realizable value, 260,000) for cash of 230,000. Ten percent of the proceeds was withheld by the factor to allow for possible customer returns and other account adjustments. The related allowance for bad debts is 40,000. 2. What amount of loss on factoring should be recognized?
On January 1, 2017, Waling waling Company sells its equipment with a carrying amount of 160,000. The company receives a non-interest bearing note due in 3 years with a face amount of 200,000. The prevailing interest rate for a note of this type is 12%. PV of 1 for 3 periods 0.71178 PV of an ordinary annuity of 1 for 3 periods 2.40183 3. What is the gain or loss to be recognized on the sale of the equipment?
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