Description
Q1. Discuss with your own examples the two methods of accounting for receivables and the two methods for estimating bad debts. (Note: Examples must include Journal entry)
Q2. X Company has the following receivables classified into individually significant and all other receivables.
|
Individually significant P Company Q Company R Company S Company All other receivables |
$ 65,000 95,000 75,000 35,000 |
270,000 425,000 |
|
Total receivables. |
695,000 |
X company determines that Ps receivable is impaired by $20,000, and Ss receivable is totallyimpaired. Both Qs and Rs receivables are not considered impaired. X company also determines that a composite rate of 2% is appropriate to measure impairment on all other receivables.
Required: Calculate the total impairment on accounts Receivable
Q3. Rex Companys record of transactions for the month of September was as follows.
|
Purchase |
Sales |
|||
|
Date |
Quantity |
Unit Price |
Date |
Units |
|
Sep 1 |
(Balance on hand) 100 |
$5.00 |
Sep 5 |
300 |
|
Sep 4 |
400 |
5.10 |
Sep 12 |
200 |
|
Sep 11 |
300 |
5.30 |
Sep 27 |
800 |
|
Sep 18 |
200 |
5.35 |
Sep 28 |
150 |
|
Sep 26 |
600 |
5.60 |
||
|
Sep 30 |
200 |
5.80 |
||
|
Total |
1,800 |
1,450 |
||
|
Total units (ending inventory) 350 |
||||
Instructions:
Compute the ending inventory at September 30 on each of the following on periodic bases.
1. FIFO
2. LIFO
3. WA
Q4. Explain the concept of LCNRV and its applicability to Agricultural Inventory and
Commodity Broker-Traders
Q5. Give examples for Gross profit and retail Methods of Estimating Inventory.
