Seller part

Carlo Company sold merchandise amounted 3,000, terms 2/10, n/60

Account Receivable 3,000 initial

Sale. 3,000

Return worth 760

Sales return and allowances 760

Acoount receivable 760

Avail discount 2%

3,000 - 760 = 2,240

Cash 2, 195 NRV

Sales discounts 45

A/R. 2, 240

Not avail discount

Cash 2240

AR 2240

Buyer part

Carlo Company purchase merchandise amounted 5,000 on account , terms 2/10, n/60

Purchases 5000

Accounts payable 5000

Return worth 1000

Accounts payable 1000

purshase return and allowances 1000

Avail 2% discount 4000

Accounts payable 4000

Purchase discounts 80

cash 3920

Not avail discount

Accounts payable 4000

cash 4000

FOB - FREIGHT ON BOARD

FOB DESTINATION OR SIMPLY MEANS FREIGHT OUT SELLER

FREIGHT OUT CLASSIFIED AS EXPENSE

FREIGHT OUT XX

CASH XX

FOB SHIPPING POINTS OR SIMPLY MEANS FREIGHT IN BUYER

CLASSIFIED ADJUNCT ACCOUNT

CONTRA ACCOUNT - DEDUCTION

ADJUNCT ACCOUNT - ADDITIONAL

FREIGHT IN XX

CASH XX
FOB DESTINATION SELLER

FREIGHT PREPAID SELLER

SOLD MECHANDISE 10000

AR 10000

SALES 10000

Freight out xx

cash xx

SOLD MECHANDISE 10000

FOB DESTINATION

FREIGHT COLLECT 1000

AR 9000

FREIGHT OUT 1000

SALE 10000

SHIPPING POINT BUYER

FREIGHT COLLECT BUYER

Freight in xx

cash xx
Additional of accounts payable

SHIPPING POINT BUYER

FREIGHT PREPAID SELLER 1000

PURCHASE 10,000 Merchandise on account

Purchases 10000

Freight in 1000

Account Payable 11000

Seller part

Gross method initial measurement as full amount and recognizing of sales discount

1. Sold of merchandise for 100,000, terms 5/10, n/30.

Accounts receivable 100,000

Sales 100,000

2. Avail discount of 5%

Cash 95000

sales discounts 5000

Acount receivable 100000

3. Beyond 10 days

Cash 100000

account receivable 100000

Net method subsequent measurement or Simply NRV

1. Sold of merchandise for 100,000, terms 5/10, n/30.

Account receivable 95,000

Sales 95,000

2. Avail discount of 5%

Cash. 95,000

AR. 95,000

3. Beyond 10 days

Cash 100,000

A/R 95,000

Sales discount forfeited 5,000

Doubtful account

Account receivable 100,000

Sales

Estimated 5% doubtful in Account receivable

Doubtful accounts expense. 5,000

Allowance for doubtful accounts 5,000

NRV = 95,000

Allowance method

1. Accounts worth 5,000 are considered collection allowance

Doubtful accounts expense. 5,000

Allowance for doubtful accounts 5,000

2. Paano kapag hindi na makukuha ang 5,000

Allowance for doubtful accounts 5,000

Account receivable 5,000

3. Paano naman kapag nakuha niya yung 5,000

Account receivable 5,000

Allowance for doubtful account. 5,000

Cash. 5000

Account receivable 5000

Written off method

1. Expected doubtful account

No entry

Assume is beginning Doubtful account 10, 000

Account receivable 300,000

AR. 300,000

ADA. 20000

Assume at the end of december 31 expected 5% in account receivable as doubtful account

Doubful expense 15,000

ADA. 15000

Assume Write off 5,000 prove to uncollectible

ADA. 5000

AR. 5000

What is the total doubtful account based on receivable as of december 31?

What is the total of NRV as of december 31? 280,000

15,000

What is the total bad debts expense?

5,000

Madolid company reported the following information at year end before adjustments

Debit. Credit

A/R. 600,000.

ADA. 10,000

SALES. 2,000,000

SALES RETURN. 40,000

SALES DISCOUNT. 60,000

A. 5% OF SALES Expected ADA =

Sales 2,000,000 less 40000 less 60,000 equal 1,900,000 x 5% = 95,000

Madolid company provided the following information for the current year.

AR 1,000,000

Sales. 500,000

Sales Return 10,000

Sales discount 10,000

Written off prove to uncollectible 1,000

ADA. 10,000

Expected 2% of receivable

WHAT IS THE TOTAL AMOUNT OF ACCOUNT RECEIVABLE BEFORE ALLOWANCE FOR DOUBTFUL
ACCOUNTS, ON DECEMBER 31, 20XX?

1,000,000 x 2% = 20,000
WHAT IS THE TOTAL AMOUNT OF ACCOUNT RECEIVABLE AFTER ALLOWANCE FOR DOUBTFUL
ACCOUNTS, ON DECEMBER 31, 20XX?

ADA for receivable 20,000

ADA 9,00

29,000

J0

E 20,000 19800

D 19600, 29580

Villan company engaged in the following transaction during the month of July

Gross method

1. Sold merchandise to Madolid company for 500,000, 2/10, n/30

ACCOUNT RECEIVABLE 500,000

SALE. 500,000

2.Madolid company returned merchandise reason is defective item worth 30,000

SALES RETURN AND ALLOWANCES . 30000

AR. 30000

3. Payment of tranportation amounted 10,000, in term of freight prepaid, FOB destination

Freight out. 10,000

Cash. 10000
4. Avail discount

Cash. 460,600

Sales discount. 9400. (470,000 x 2%)

AR. 470,000

5. Not avail discount

Cash 470,000

AR 470,000

J tapos na 1 + 1

E tapos na 1 + 1

D tapos na 1
10 minutes

Villan company engaged in the following transaction during the month of July

Gross method

1. Sold merchandise to Madolid company for 700,000, 5/10, n/30 Payment of tranportation amounted
20,000, in term of freight collect, FOB destination

AR. 680,000

Freight out 20,000

Sales. 700,000

2.Madolid company returned merchandise reason is defective item worth 50,000

Sales return and allowances 50,000

AR. 50,000

3. Payment of tranportation amounted 20,000, in term of freight collect, FOB destination

Freight out. 20000

AR. 20,000

4. Avail discount

Cash 617,500

Sales discount 32500

AR. 650,000

CASH 598,500

SALES Discounts. 31500

AR 630,0000

5. Beyond discount
Cash 630k

AR. 630k

J 4

E tapos na 4

D. 4

Gross method

Bo company tires entered into the following transactions during the month of December 2021:

A. Sold merchandise for cash, 20000

Cash 20,000

Sales 20,000

B. Sold merchandise to Madolid company trading on credit amounted 200,000 terms 2/10,n/30

Payment of tranportation amounted 20,000, in term of freight collect, FOB destination

AR 180,000

Freight out 20,000

Sales. 200,000

C. Sold 700 book at cost 500 per book, terms of payment 1/10, n/45

AR. 350,000

SALES. 350,000

D. Payment of tranportation amounted 10,000, in term of freight prepaid, FOB destination related in
transaction C

Freight out. 10,000

Cash. 10,000
E. Avail discount related in transaction B

Cash 176,400

Sales discount 3600. (180k x 2%)

AR 180,000

F. Beyond discount related in transaction C

Cash 350,000

AR. 350,000

At the beggining the following include:

ADA 100,000

Cost of good sold 300,000

Expected 5% receivable

Administrative expense 10,000

Selling expense 2,000

1. Prepare journal entry

2. WHAT IS THE TOTAL AMOUNT OF ACCOUNT RECEIVABLE BEFORE ALLOWANCE FOR DOUBTFUL
ACCOUNTS, ON DECEMBER 31, 20XX?

3. WHAT IS THE TOTAL AMOUNT OF ACCOUNT RECEIVABLE AFTER ALLOWANCE FOR DOUBTFUL
ACCOUNTS, ON DECEMBER 31, 20XX?

100,000

4. What is the total amount of net sales? 20,000 + 200,000 + 350,000 = 570,000
5. What is the total gross margin/income?

570,000 - 300,000 = 270,000

6. What is the total net income /loss?

270,000 - 10,000 - 2,000 = 258,000

Sales

less cost of good sold

Total gross income

Less operation expense

Total net income/loss