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12. On December 31, 2022, Sohee company estimated the

allowance for doubtful accounts using the year-end aging of

accounts receivable. The following data for are available:

Allowance for doubtful accounts, 1/1/22 250,000

Provision for uncollectible accounts recorded

during 2022 (2% on credit sales of

P30,000,000)

600,000

Uncollectible accounts written off 150,000

Recovery of accounts previously written off 80,000

Estimated uncollectible accounts per aging,

12/31/22

900,000

What is the year-end adjustment to doubtful accounts

expense?

a. 120,000 c. 900,000

b. 720,000 d. 600,000

NRV of receivable

13. Accounts receivable are normally reported at the

A. Present value of future cash receipts

B. Current value plus accrued interest

C. Expected amount to be received

D. Current value less expected collection cost

Packers Company sold goods to wholesalers on terms 2/15,

net 30. The entity had no cash sales but 50% of the

customers took advantage of the discount. The entity used

the gross method of recording sales and accounts

receivable. An analysis of the trade accounts receivable at

year-end revealed the following:

Age Amount Collectible

0 - 15 days 10,000,000 100%

16 - 30 days 7,000,000 90%

31 - 60days 2,000,000 80%

Over 60 days 1,000,000 50%

20,000,000

14. What amount should be reported as allowance for sale

discount at year-end?

a. 100,000 c. 300,000

b. 200,000 d. 0

15. What is the net realizable value of accounts receivable?

a. 20,000,000 c. 18,300,000

b. 18,400,000 d. 18,200,000

Allowance method VS. direct write off method

16. An entity uses the allowance method for recognizing

doubtful accounts. The entry to record the write off of

specific uncollectible account.

a. Affects neither net income nor working capital

b. Affects neither net income nor account receivable

c. Decreases both net income and working capital

d. Decreases both net income and accounts receivable

17. Which of the following is not permitted for material

amount of uncollectible accounts receivable?

a. Percentage of accounts receivable using allowance

method

b. Percentage of sales using allowance method

c. Direct write-off method

d. All of the choices are acceptable

18. When the direct write off method is used, the entry to

write off a specific customer account would

A. Increase both accounts receivable and net income

B. Decrease both accounts receivable and net income

C. Increase net income

D. Have no effect on net income

Presentation of accounts receivable

19. When examining the accounts of Medved Company, you

ascertain that balances relating to both receivables and

payables are included in a single controlling account called

receivables control that has a debit balance of P4,850,000.

An analysis of the composition of this account revealed the

following:

Debit Credit

Account receivable -

customers

P7,800,000

Accounts receivable -

officers

500,000

Debit balances - creditors 300,000

Postdated checks from

customers

400,000

Subscriptions receivable 800,000

Accounts payable for

merchandise

P4,500,000

Credit balances in

customers' accounts

200,000

Cash received in advance

from customers for

goods not yet shipped

100,000

Expected bad debts 150,000

After further analysis of the aged accounts receivable, you

determined that the allowance for doubtful accounts should

be P200,000.

What is the correct total of current net receivables?

a. 8,950,000 c. 8,600,000

b. 8,800,000 d. 8,850,000

20. The following are normally included in the line item trade

and other receivables', except

a. Advances to officers and employees

b. Advances to subsidiaries and affiliates

c. Receivables from sale of securities or property other

than inventory.

d. Dividends and interest receivable.