Copy of SOL. MAN. Chapter 4 Accounts Receivable IA PART 1A 2020 Edition PDF

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Chapter 4Accounts ReceivablePROBLEM 1: TRUE OR FALSE1. FALSE – 1,000 x 70% = ₱700 invoice price 2. FALSE 105 3. FALSE April 2, 20x 4. TRUE 5. TRUE 6. FALSE - 400 7. FALSE 25 8. FALSE 7 9. TRUE 10. TRUE (121 age – 30 days credit) = 91 days past duePROBLEM 2: MULTIPLE CHOICE – THEORY1. D2. D3. D4. D5....

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Chapter 4 Accounts Receivable PROBLEM 1: TRUE OR FALSE 1. F ALSE–1, 000x70% =₱70 0i nvoi c epr i c e 2. F ALSE105 3. F ALSEApr i l2, 20x1 4. TRUE 5. TRUE 6. F ALSE-400 7. F ALSE25 8. F ALSE7 9. TRUE 10.TRUE( 121a ge–30da ysc r e di t )=91da yspas tdue

PROBLEM 2: MULTIPLE CHOICE – THEORY 1. D 2. D 3. D 4. D 5. B 6. A 7. D 8. A 9. B 10.A-Choi c e( a)i st hebe s tans we r .Badde bt sar ec omput edon c r e di ts al e s( e xc l udi ngc as hs al e s ) . Choi c e( d)i sc or r e c t– PFRS 9 enc our a ge sa c ombi na t i on of c ol l ec t i veas s e s s me nt( e . g. ,a gi ng)andi ndi vi dualas s e s s ment( i . e . , s pe c i ficac c ount s ) .

PROBLEM 3: EXERCISES 1. So l ut i o n: Tr a der e c e i v a b l e s : Ac c ount sr e c e i vabl e

1 60 , 0 0

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Addbac kc r e di tbal anc ei nc us t ome r s ' ac c ount s Ad j us t e da c c o unt sr e c e i v a b l e Not e sr e c e i vabl e( t r ade ) Tot alt r ader e c e i vabl e s-Re qui r e me nt( a) No nt r a d er e c e i v a b l e sc ur r e nt l yc o l l e c t i b l e : Not e sr e c e i vabl e( c ur r e ntpor t i ononl y) Di vi de ndsr e c e i vabl e Advanc e st os uppl i e r s( f r o m de b i tb a l a nc ei na c c o unt s p a ya b l e ) To t a lc ur r e ntno nt r a d er e c e i va b l e s Tr adeandot he rr e c e i vabl e s-Re qui r e me nt( b)

2. So l ut i o ns : Re qui r e me nt( a) : J o ur na le nt r yo nda t eo fs a l e : Ac c ount sr e c e i vabl e Re ve nue

0 3 2, 0 0 0 1 92 , 0 0 0 1 6, 0 0 0 2 08 , 0 0 0 1 6, 0 0 0 3 , 2 00 1 9, 2 0 0 3 8, 4 0 0 2 46 , 4 0 0

7, 084. 8 0a 7, 084. 8 0a

a ( 10, 000x8 0% x9 0%)=7, 2 00i nvoi c epr i c e ; [ 7 , 200–( 7, 2 00x2 % x80%) ]= 7, 0 84. 8 0

 Sub s e q ue ntme a s ur e me nt Theadj us t me nti sc omput e dasf ol l ows : I nvoi c eamount( 10, 000x80% x90%) Mul t i pl yby: To t a la v a i l a b l edi s c o unt Mul t i pl yby:Re vi s e de s t i ma t e Di s c ounte xpe c t e dt obet ake n( r e vi s e d) I nvoi c eamount Le s s : Di s c ounte xpe c t edt obet ake n( r e vi s e d) Tr ans ac t i onpr i c e( r e vi s e d) Le s s : Tr ans ac t i onpr i c e( i ni t i a le s t i ma t e ) Adj us t me nt–i nc r e as ei nt r ans ac t i onpr i c e

7, 200 2% 144 40% 57. 60 7, 200 ( 57. 60) 7, 142. 4 0 ( 7, 0 84. 80 ) 57. 60

Page|3 Ye a r e nda d j us t i nge nt r y: Ac c ount sr e c e i vabl e Re ve nue

57. 60 57. 60

Re qui r e me nt( b) : Thee nt i t yr e por t sac c ountr ec ei vabl eandne tr e ve nueof₱7 , 142. 40 i ni t sye ar e ndfinanc i a ls t a t eme nt s .

3. So l ut i o ns : Re qui r e me nt( a) : Badde bte xpe ns e Tot a ls a l e s Ca s hs a l e s Gr o s sc r e di ts a l e s Sa l e sr e t ur nsa nddi s c ount sonc r e di ts a l e s( 1 3 , 2 00– 2 , 2 00 ) Ne tc r e d i ts a l e s Mul t i pl yb y: Pe r c e nt a geofne tc r e di ts a l e s Badde bte xpe ns e

1 , 3 20 , 00 0 ( 2 20 , 0 00 ) 1 , 1 00 , 00 0 ( 1 1, 00 0) 1 , 0 89 , 00 0 2 % 2 1, 7 8 0

Re qui r e me nt( b) :Al l owanc ef ordoubt f ulac c ount sonDe c .3 1 Al l owanc ef ordoubt f ulac c ount s 1 7, 6 0 0 J a n.1 Wr i t e off 1 1, 0 0 0 2 , 2 00 Re c ove r y 2 1, 7 8 0 Ba dde bt se xpe ns e Dec . 31( s que e ze ) 3 0, 5 8 0 Re qui r e me nt( c ) :Car r yi ngamountofac c ount sr e c e i vabl e Ac c ount sr e c e i vabl e ,De c . 31–gr o s s 33 0, 000 Al l owanc ef ordoubt f ulac c ount s ,De c . 31 ( 30, 580) Ac c ount sr e c e i vabl e , De c . 31–ne t 299, 420

4. So l ut i o ns : Re qui r e me nt( a) : Badde bte xpe ns e Ac c ount sr e c e i vabl e J a n. 1 4 0, 0 0 0 2 , 5 00 Wr i t e off

Page|4 Ne tc r e di ts a l e s

1 35 , 0 00

7 0, 0 0 0 Col l e c t i ons , e xc l g . r e c ove r y 1 02 , 5 00 De c . 3 1( s que e ze )

Ac c ount sr e c e i vabl e ,De c . 31 Per c e nt a geofr ec e i vabl e s Al l owanc ef ordoubt f ulac c ount s-De c .31

102, 500 5% 5, 125

Al l owanc ef ordoubt f ulac c ount s 5 , 0 00 J an.1 Wr i t e off 2, 5 0 0 5 00 Re c ove r y 2 , 1 25 Badde bt se xpe ns e( s que e ze ) De c . 31 5 , 1 25

Re qui r e me nt( b) :Ne tr e al i zabl eval ueofac c ount sr e c e i vabl e Ac c ount sr e c e i vabl e ,De c . 31–gr o s s 102, 500 Al l owanc ef ordoubt f ulac c ount s ,De c . 31 ( 5, 125) Ac c ount sr e c e i vabl e , De c . 31–ne t 97, 375

5. So l ut i o n: ( Tot alWr i t e offsf r om 20 x1t o20x3)l e s s( Tot al Rec ove r i e sf r om 20x1t o20 x3) Tot alNe tc r edi ts al e sf r om 20x1t o20x3 =[ ( 21K+30K+45K)–( 3K+9K+1 5K) ]÷( 300K+480K+ 600K) =( 96, 000–27, 000)÷1, 3 80, 000 Pe r c e nt age( J an.1, 20x4)=( 69, 000÷1, 38 0, 000)=5% Pe r c e nt a g e = ( J a n. 1, 20x4)

( Tot alWr i t e offsf r om 2 0x1t o20 x4)l e s s ( Tot alRe c over i e sf r om 20x1t o20x4) Tot alNe tc r e di ts al e sf r om 20x1t o20 x4 =( 180, 000–3 3, 000)÷2, 1 00, 000 Pe r c e nt age( De c . 31, 20x4)=( 147, 000÷2, 100, 000)=7 % Pe r c e nt a g e = ( De c . 31,20x 4)

Al l owanc ef ordoubt f ulac c ount s 1 5, 0 0 0 J a n.1 , 20 x4( 5% x300 , 00 0 ) 2 0x 4wr i t e o ffs 8 4, 0 0 0 6 , 0 00 2 0x4r e c o v e r i e s 1 05 , 0 00 Badde bt se xpe ns e( s que e ze ) De c . 31 ,2 0x 4( 7 % x2 00, 000 ) 4 2 , 00 0

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6. So l ut i o n: Dayspas tdue tdue-0t o15d a y so fag e  No tdue-16t o3 0d a y so fage  No  1-3 0da yspas tdue  3 1-60da yspas tdue  6 1-90da yspas tdue  9 1-12 0da yspas tdue Tot al s

% ol l e c t i bl Re c e i vabl e Unc e bal anc e s

( a) 35 0, 0 0 0 2 10 , 0 00 1 75 , 0 00 1 40 , 0 00 1 05 , 0 00 70 , 0 00 1 , 0 50 , 0 00

( b) None None 3% 10 % 15 % 3 5%

Re qui r e d al l owanc e

( a)x( b) 5 , 2 50 1 4, 0 0 0 1 5, 7 5 0 2 4, 50 0 5 9, 5 0 0

Al l owanc ef ordoubt f ulac c ount s 2 8, 0 0 0 Be g. ba l . Wr i t e offs 6 , 0 00 2, 000 Re c ove r i e s 3 5, 5 0 0 Badde bt se xpe ns e( s que e ze ) End. Bal .5 9, 5 0 0

7. So l ut i o ns : Re qui r e me nt( a) : Unadj us t e dbadde bte xpe ns e Ne tc r e di ts al e s Per c e nt a geofc r e di ts al e s

4, 200, 0 00 2%

Unadj us t e dbadde bt se xpe ns e

84, 000

Re qui r e me nt( b) :Al l owanc ef ordoubt f ulac c ount s–J an.1, 20x1 Al l o wa nc ef o rd o ub t f ula c c o unt s 1 2, 6 0 0 J an. 1, 2 0x 1( s que e ze ) Wr i t e offs 7 9, 8 0 0 1 8, 9 00 Re c ove r i e s 8 4, 0 0 0 Unadj us t e dba dde bt s De c . 31una d j us t e db a l . 3 5, 7 0 0

Page|6 Re qui r e me nt( c ) :Re qui r e de ndi ngbal anc eoft heal l owanc e % Re c e i vabl e unc ol l e c t i bl Re qui r e d Daysout s t andi ng bal anc e s e al l owanc e ( a)

   

0–60 6 1-1 20( 1 89K–42 K) Se gr e ga t e da c c ount Ove r1 20( 210K21K)

Tot al s

25 2, 00 0 14 7, 00 0 42 , 00 0 18 9, 00 0

( b)

( c )=( a)x ( b)

1 % 2 % 5 %

2 , 5 20 2 , 9 40 2 , 1 00 11 , 3 40

6 %

63 0, 00 0

1 8, 9 0 0

Re qui r e me nt( d) : Adj us t e dbadde bte xpe ns ef ort heye ar Al l o wa nc ef o rd o ub t f ula c c o unt s 1 2, 6 0 0 J a n.1 , 20 x1[ s e er e q ’ mt .( b ) ] 1 00 , 8 0 1 8, 9 0 0 0 Re c o v e r i e s Wr i t e o ffs( 7 9. 8 K+21K) 8 8, 2 0 0 Adj us t e dbadde bt s( s que e ze ) De c . 31 ,2 0x 1b a l . 1 8, 9 0 0 Re qui r e me nt( e ) :Ye ar e ndr e c ove r abl ehi s t or i c alc os t Gr os sac c ount sr e c e i vabl e , De c . 31b e f o r e a d j us t me nt s Addi t i onalwr i t e offa tye ar e nd Gr os sac c ount sr e c e i vabl e , De c . 31a f t e ra d j us t me nt s Al l owanc ef ordoubt f ulac c ount s ,De c . 31( a d j us t e d) Ac c ount sr e c e i vabl e-ne t ,De c .31 Re qui r e me nt( f ) :Ye ar e ndadj us t i nge nt r i e s De c . 3 1, Al l owanc ef ordoubt f ula c c ount s 2 0x1 Ac c ount sr e c e i vabl e

65 1, 000 ( 21, 000) 630, 000 ( 18, 900) 611, 100

2 1, 0 0 0 2 1 , 00 0

t or e c o r dt h ea d di t i o na lwr i t e o ff De c . 3 1, 2 0x1

Ba dde bt se x pe ns e Al l owa nc ef ordoubt f ul a c c ount s

4 , 2 00

t or e c o r dt h ea d di t i o na lb a dde b t s

PROBLEM 4: MULTIPLE CHOICE – COMPUTATIONAL 1. BSo l ut i o n:  300, 000x80 % =240 , 000i nvoi c epr i c e ;

4 , 2 00

Page|7  240, 000x5% x80% =9, 600di s c ount ;  240, 000–9, 600=230, 400 2. A-100, 000x90% x97%*=87, 30 0 * I ft hec us t ome rf ul l ys e t t l e st hea c c ountwi t hi n10da ys , t he c us t ome rc annott akeanymor et he1% di s c ountt ha ti sa vai l abl ei f hepa yswi t hi nt he1 1thda yand15thda y . 3. B–250, 000s a l epr i c e+20, 000r e i mbur s eme ntoff r e i ght= 270, 000 4. A( 100, 000x50% x2%)=1, 000 5. A So l ut i o n: Al l owanc ef orbadde bt s 10, 800 J an.1 Wr i t e offs 18, 000 13, 500 Badde bt se xpens e( 450 Kx3%) Dec .3 1 6, 300

6. D( 1, 00 0, 000x3%)=30, 000 7. A So l ut i o n: DaysEs t i mat e d out s t andi ng

% ol l e c t i bl e Amount unc

0-6 0 6 1-1 20 Ove r1 20

1 20 , 0 00 9 0, 00 0 1 00 , 0 00

1 % 2 % 6 %

Al l owanc e

1 , 2 00 1 , 8 00 6 , 0 00 9 , 0 00

8. CSo l ut i o n: be g. Cr e di ts a l e s

Ac c ount sr e c e i vabl e 1 50 , 0 00 6 00 , 0 00 4 10 , 0 00 Col l e c t i ons , e xc l d.r e c ove r i e s 9, 0 0 0 Wr i t e off 3 31 , 0 00 e nd.

Page|8

Wr i t e off e nd.

Al l owanc ef orbadde bt s 12 , 0 00 9, 00 0 15 , 0 00 2, 0 00 20 , 0 00

be g. Ba dde bt s Re c ove r y

Car r yi ngamount=331, 000–20, 000=311, 00 0 9. ASo l ut i o n: Ac c o unt sr e c e i v a b l e 8 0, 0 0 0 1 50 , 0 0 Cr e di ts al e s 0 1 20 , 0 00 Col l e c t i ons , e x c l dg. r e c ove r i e s 10 , 0 00 Wr i t e off 1 00 , 0 00 e nd . be g.

10.B

Page|9 PROBLEM 5: CLASSROOM ACTIVITIES ACTI VI TY#1: TOTALCURRENTRECEI VABLES So l ut i o ns : Re qui r e me nt( a) : Adj us t e dac c ount sr e c e i vabl e Unadj us t e dac c ount sr e c ei vabl e Cr edi tbal anc e( DEFCo. ) Sal e sOr de r#2 1022394 Adj us t e dac c ount sr e c e i vabl e

10, 537, 08 9 341, 236 20, 000 10, 898, 32 5

Re qui r e me nt( b) :Tot alc ur r e ntr e c e i vabl e s Adj us t e dac c ount sr e c ei vabl e Not esr ec ei vabl e( 3 mont h) Di vi de ndsr e c e i vabl e( 10, 00 0s h.x₱5) Tot alCur r e ntr e c e i vabl e s

10, 898, 32 5 35, 000 50, 000 10, 983, 32 5

Re qui r e me nt( c ) :Adj us t i nge nt r i e s Ac c ount sr e c e i vabl e 341, 236 Advanc e sf r om c us t omer s 341, 236 Toe l i mi na t et hec r e di tb a l a nc ei nDEFCo . ’ sa c c o unt Ac c ount sr e c e i vabl e 20, 000 Sal e s Tor e c o r dt heunr e c o r de ds a l e s

20, 000

Not e sr e c e i vabl e 35, 000 Cas h Tor e c o r dt hel o a ngi ve nt oMr . Wi l s o n

35, 000

Di vi de ndsr e c e i vabl e 50, 000 Di vi de ndi nc ome Toa c c r uet hedi vi de nds ACTI VI TY#2: J OURNALENTRI ES So l ut i o ns :

50, 000

Page|10 Re qui r e me nt( a) : J our nale nt r i e s 1) Ac c ount sr e c e i vabl e Sal e s Tor e c o r dSI #001101

20, 000

2) a . Ac c ount sr e c e i vabl e 3, 000 Al l owanc ef orbadde bt s Tor e ve r s et hepr e vi o uswr i t e o ff

20, 000

3, 000

Cas h 3, 000 Ac c ount sr e c e i vabl e 3, 000 Tor e c o r dt hec o l l e c t i o no fa c c o unt sr e c e i va b l e b. Cas h 25, 000 Ac c ount sr e c e i vabl e 25, 000 Tor e c o r dt hec o l l e c t i o no fa c c o unt sr e c e i va b l e c . Ac c ount sr e c e i vabl e 19, 000 Cas h Tor e c o r dt heNSFc he c k

19, 000

3) Badde bt se xpe ns e 22, 41 4. 88* Al l owanc ef orbadde bt s Toa c c r ueb a dde b t sf o rt hey e a r

22, 414. 8 8

* Una dj us t e dc r e di ts al e s

2, 22 1, 488

Add: SI #001 101 Ad j us t e dc r e di ts a l e s Mul t i pl yby:

20, 000 2, 241, 488 1%

Badde bt se xpe ns e-20x 1

2 2, 414. 88

4) Al l owanc ef orbadde bt s( 7K+2K)9 , 000 Ac c ount sr e c e i vabl e Tor e c o r dt hewr i t e o ffo fa c c o unt s

9, 000

Page|11 Re qui r e me nt( b) :Adj us t e dbal anc e sofA/ R& Al l owanc e Ac c ount sr e c e i vabl e Unadj us t e d ( 1)

480, 000 20, 000

( 2a) ( 2c )

3, 000

3, 000

19, 000

25, 000 9, 000

( 2b) ( 4)

485, 000

Adj us t e d

Al l owanc ef orbadde bt s

( 4 ) Adj us t e d

12, 000 3, 000

Unadj us t e d ( 2a)

22, 414. 88

( 3)

9, 000 2 8, 414. 88

Re qui r e me nt( c ) :Car r yi ngamountofac c ount sr e c e i vabl e Ac c ount sr e c e i vabl e

485, 000

Al l owanc ef orbadde bt s

( 28, 414. 88)

Car r yi ngamount

456, 585. 12

ACTI VI TY#3: DEBTSEXPENSE So l ut i o ns : Re qui r e me nt( a) : BDE-20x2: ( 9, 824, 000x80% x2. 5%)=196, 480 BDE-20x1: ( 2, 670, 000x80% x2. 5%)=53, 400

Page|12 Re qui r e me nt( b) : Al l owanc ef orbadde bt s 12. 31. x1( 836Kx 41, 800 5%) 00 BDE-20 x2 115, 00 196, 0 ( s que e ze ) Wr i t e offs 0 12. 31. x2( 2. 456M x 122, 80 5%) 0

Al l owanc ef orbadde bt s -

Wr i t e offs 12. 31. x1( 836Kx 5%)

12, 000 4 1, 800

3. 7. x1 BDE-20 x1 s que e ze ) 53, 800 (

Page|13 ACTI VI TY#4: AGI NG ( PROVI SI ON MATRI X)

Dear Sir / Ma’am: Theans we ri sal r e adyi ndi c a t edi nt heac t i vi t y( * Hi nt s ) . The s t ude ntwi l lbegr adedbas e donhi s /he rc r e a t i vi t yande xt r ae ffor t i nmaki ngt her epor tl ookpr of e s s i onal .Sug g e s t e dc r i t e r i a : 1. He adi ngf ort her e por t( e . g. , Agi ngRepor torPr ovi s i on Ma t r i x) 2. Al lheadi ngs , i nc l udi ngt hec ut offda t e , ar ei nbol dl e t t er s 3. Tot al sar edoubl e r ul e d 4. Ther e qui r edbal a nc eoft heal l owanc ei sl abe l edass uc h 5. Thepe r c e nt a ge sar ef or ma t t e dasper c e nt ages( i . e . , x%) 6. e t c …. .( e ndoft hi nki ngc apac i t y) Si nc e r e l y ,

Zeus Vernon B. Millan

Page|14 PROBLEM 6: FOR CLASSROOM DISCUSSION 1 . So l ut i o n: 1 73 , 0 0 0 ( 8 , 0 00 ) 1 65 , 0 00

Ac c ount sr e c e i vabl e( 1 58 K+1 5K) Al l owanc ef orunc ol l e c t i bl eac c ount s Tot alt r ader e c e i vabl e s

12 , 00 0 22 0, 00 0 18 0, 00 0 4 12 , 0 00 5 77 , 0 00

Cl ai mf ort a xr e f und Di vi de ndsr e c e i vabl e Advanc e st ooffic e r s( duei n6mont hs ) Tot alnont r ader e c e i vabl e s Tot alc ur r e ntr e c e i vabl e s

Tot alnonc ur r e ntr e c e i vabl e s

18 0, 00 0 90 0, 00 0 30 , 00 0 1 , 1 10 , 0 00

TOTALRECEI VABLES

1 , 6 87 , 0 00

Not e sr e c e i vabl e( nont r ade ) Advanc e st oa ffil i a t e s Se c ur i t yde pos i tonal ongt e r ml e a s e

2 . So l ut i o ns : a . FOBs hi p pi ngpo i nt , f r e i g h tc o l l e c t De c . 2 7, 2 0x1 De c . 3 1, 2 0x1

Noe nt r y Ac c ount sr e c e i vabl e Sa l e s

1 , 6 00 1 , 6 00

t or e c o r ds a l eo na c c o unt J a n.2 , 2 0x2

Noe nt r y

J a n.5 , 2 0x2

Cas h Ac c ount sr e c e i vabl e t or e c o r ds e t t l e me nto fa c c o unt sr e c e i v a b l e

b. FOBd e s t i na t i o n, f r e i g h tp r e pa i d De c . 2 7, Noe nt r y 2 0x1

1 , 6 00 1 , 6 00

Page|15

De c . 3 1, 2 0x1

Pr e pai df r e i ght Ca s h

5 0 5 0

t or e c o r dpr e p a yme nto ff r e i g htt ot hec a r r i e r J a n.2 , 2 0x2

Ac c ount sr e c e i vabl e Sa l e s

1 , 6 00 1 , 6 00

t or e c o r ds a l eo na c c o unt J a n.2 , 2 0x2

Fr e i ght out Pr e pai df r e i ght

5 0 5 0

t oc h a r g et h epr e pa i df r e i g h tt oe x pe ns e J a n.5 , 2 0x2

Cas h Ac c ount sr e c e i vabl e

1 , 6 00 1 , 6 00

t or e c o r ds e t t l e me nto fa c c o unt sr e c e i v a b l e

c . FOBs hi pp i ngpo i nt , f r e i g htpr e pa i d De c . 2 7, 2 0x1

Noe nt r y De c . 3 1, 2 0x1

Ac c ount sr e c e i vabl e Sa l e s Cas h

1 , 6 50 1 , 6 00 5 0

t or e c o r ds a l eo na c c o unta ndf r e i g htpa i do n b e ha l fo ft heb uy e r J a n.2 , 2 0x2 J a n.5 , 2 0x2

Noe nt r y Cas h Ac c ount sr e c e i vabl e

1 , 6 50 1 , 6 50

t or e c o r dc o l l e c t i o no fa c c o untr e c e i va b l e i nc l us i v eo fr e i mb ur s e me ntf o rt hef r e i g htpa i d

d. FOBd e s t i na t i o n, f r e i g htc o l l e c t De c . 2 7, 2 0x1

Noe nt r y De c . 3 1, 2 0x1 J a n.2 , 2 0x2

Noe nt r y Ac c ount sr e c e i vabl e Fr e i ght out Sa l e s t or e c o r ds a l eo na c c o unta ndf r e i g ht

1 , 5 50 5 0 1 , 6 00

Page|16 a c c o mmo d a t e db yt h eb uy e r J a n.5 , 2 0x2

1 , 5 50

Cas h Ac c ount sr e c e i vabl e

1 , 5 50

t or e c o r dc o l l e c t i o no fa c c o untr e c e i va b l ene to f

r e i mb ur s e me ntf o rt hef r e i g ht

3 . So l ut i o ns :

Re qui r e me nt( a) : Tr adi t i onalGAAP Gr os sme t hod 1. Sa l eo na c c o unt Ac c ount sr e c ei vabl e90, 0 00 Sal e s 9 0, 0 00

Ne tme t hod Ac c ount sr e c ei vabl e87, 3 00 Sal e s 8 7, 3 00

( ₱1 00 , 0 00x90%)

( ₱1 00 , 0 00x90% x9 7%)

2. Co l l e c t i o ni sma d ewi t hi nt hedi s c o untp e r i o d Cas h 87 , 300 Cas h 87 , 300 Sal e sdi s c ount s(90Kx3%)2, 70 0 Ac c ount sr ec e i vabl e 87 , 300 Ac c ount sr ec e i vabl e 9 0, 000

3. Co l l e c t i o ni sma d eb e y o ndt hedi s c o untpe r i o d. Cas h 90, 000 Cas h 90, 0 00 Sal e sdi s c ountf or f e i t e d 2, 700 Ac c ount sr e c ei vabl e 90, 0 00 Ac c ount sr e c ei vabl e 87, 3 00

Re qui r e me nt( b. 1) : PFRS15 I nvoi c eamount( 100, 0 00x90%) Mul t i pl yby: To t a la v a i l a b l edi s c o unt Mul t i pl yby: Di s c ounte xpe c t e dt obet ake n

90, 000 3% 2, 700 80% 2, 160

I nvoi c eamount Le s s : Di s c ounte xpe c t edt obet ake n Tr ans ac t i onpr i c e

90, 000 ( 2, 1 60) 87, 840

1. Sa l eo na c c o unt Ac c ount sr e c e i vabl e

87, 840

Page|17 Re ve nue

87, 840

2. Po r t i o nc o l l e c t e dwi t hi nt hed i s c o untpe r i o d Cas h( 90, 0 00x80% x9 7%) Ac c ount sr e c ei vabl e

69, 840

3. Po r t i o nc o l l e c t e db e yo ndt hedi s c o untpe r i o d Cas h( 90, 0 00x20%)or( 87, 8 40–6 9, 840 ) Ac c ount sr e c ei vabl e

18, 000

69, 840

18, 000

Re qui r e me nt( b. 2) : PFRS15 1. Sa l eo na c c o unt Ac c ount sr e c e i vabl e( 100Kx90%) Re ve nue Sal e sdi s c ount Al l owanc ef ors al e sdi s c ount

90, 000 90, 000 2, 160 2, 160

2. Po r t i o nc o l l e c t e dwi t hi nt hed i s c o untpe r i o d Cas honhand( 90 , 000x80 % x97 %) Al l owanc ef ors al e sdi s c ount Ac c ount sr e c ei vabl e( 90, 0 00x8 0%)

69, 840 2, 160

3. Po r t i o nc o l l e c t e db e yo ndt hedi s c o untpe r i o d Cas honhand[ ( 90Kx20%)o rr e ma i ni ngb a l a nc e ] Ac c ount sr e c ei vabl e

18, 000

4 . So l ut i o n: Re qui r e me nt( a) : ( a ) Ac c ount sr e c e i vabl e Sa l e s ( b)

72, 000