On 12-31-15, Fuji Inc.’s balance sheet reported Accounts Receivable of $100,000
ID: 2533093 • Letter: O
Question
On 12-31-15, Fuji Inc.’s balance sheet reported Accounts Receivable of $100,000 before Allowance for Uncollectibles of $10,000. Credit sales during 2016 were $611,000 and collections from customers were $591,000. During 2016, Accounts Receivables of $45,000 were written off and $17,000 were recovered. On 12-31-16, Fuji Inc. estimated that $15,000 of its Accounts Receivables were uncollectible.
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What amount should Fuji Inc. report as Accounts Receivables on 12/31/16?
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Explanation / Answer
Account Recievables Opening Balance 100000 Add: Credit Sales 611000 Less: Collections 591000 Less: AR write off 45000 Add: Reinstatement of AR 17000 Less: Collection of Reinstated AR 17000 Closing Balance 75000 Allowance for Recievables Write off of AR: Opening Balance 10000 PL Account Dr. 35000 Less: AR Write off 10000 Allowance for Reciavable Dr. 10000 Net Balance during the Year 0 To Account Recievable 45000 New Estimate of Uncollection 15000 Closing Balance 15000 Reinstatement of AR: Account Recievable Dr. 17000 To PL Account 17000 AR To be Reported at Year End: Account Recievalable, Gross 75000 Collection of Reinstated AR: Allowance for Uncollectible 15000 Cash Account Dr. 17000 Account Recievalable, Net 60000 To Account Recievable 17000
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