For Recitation/Online poll:

1. Marilag Company starts the year with an allowance for doubtful

accounts balance of 9,000 (credit). During the year, 15,000 in
receivables are written off as uncollectible, bad debt expense of
26,000 is recognized, and a 2,000 account previously written off as
uncollectible is actually collected.

What is the ending Allowance for Doubtful Accounts account balance

at the end of the year?

a. 18,000 Credit balance

b. 22,000 Credit balance
c. Answer not given
d. 20,000 Credit balance

2. Mabilis company has a beginning Accounts receivable balance

of 700,000. During the year, the company generated credit
sales amounting to 2.8M with 100,000 sales returns and write
offs of 50,000. During the year, the company collected a
total of 2.2M.

At the end of the year, the company estimated future sales

returns at 50,000 and uncollectible accounts of 100,000.

What amount should the company report for gross Accounts

Receivable balance at year end?

a. 1,100,000
b. 1,000,000
c. 1,150,000
d. 1,050,000

3. If a company employs the gross method of recording accounts receivable from customers, then
sales discounts taken should be reported as
A. A deduction from sales in the statement of comprehensive income.
B. An item of “other expense” in the statement of comprehensive income.
 C. A deduction from accounts receivable in determining the net realizable value of accounts
receivable.
D. A deduction from the cost of goods sold in the statement of comprehensive income.

4. Which of the following shall be taken into consideration when measuring and recognizing
impairment loss on receivables?
I. Past experiences on the collectability of the receivables
II. Present condition of the debtor, including the present economic environment.
III. Future expectations based on information that are available without undue cost and effort.

A. I only
B. II only
C. I and II
D. I, II and III