Cordova, Incorporated, reported the following receivables in its December 31, 2023, year-end balance sheet: Current assets: Accounts receivable, net of $62,000 in allowance for uncollectible accounts $ 394,000 Interest receivable 31,100 Notes receivable 510,000 Additional information: The notes receivable account consists of two notes, a $110,000 note and a $400,000 note. The $110,000 note is dated October 31, 2023, with principal and interest payable on October 31, 2024. The $400,000 note is dated March 31, 2023, with principal and 10% interest payable on March 31, 2024. During 2024, sales revenue totaled $2,220,000, $2,080,000 cash was collected from customers, and $51,000 in accounts receivable were written off. All sales are made on a credit basis. Bad debt expense is recorded at year-end by adjusting the allowance account to an amount equal to 9% of year-end gross accounts receivable. Required: In addition to sales revenue, what revenue and expense amounts related to receivables will appear in Cordova’s 2024 income statement? Calculate the receivables turnover ratio for 2024.
Cordova, Incorporated, reported the following receivables in its December 31, 2023, year-end balance sheet: Current assets: Accounts receivable, net of $62,000 in allowance for uncollectible accounts $ 394,000 Interest receivable 31,100 Notes receivable 510,000 Additional information: The notes receivable account consists of two notes, a $110,000 note and a $400,000 note. The $110,000 note is dated October 31, 2023, with principal and interest payable on October 31, 2024. The $400,000 note is dated March 31, 2023, with principal and 10% interest payable on March 31, 2024. During 2024, sales revenue totaled $2,220,000, $2,080,000 cash was collected from customers, and $51,000 in accounts receivable were written off. All sales are made on a credit basis. Bad debt expense is recorded at year-end by adjusting the allowance account to an amount equal to 9% of year-end gross accounts receivable. Required: In addition to sales revenue, what revenue and expense amounts related to receivables will appear in Cordova’s 2024 income statement? Calculate the receivables turnover ratio for 2024.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 12E: Inferring Accounts Receivable Amounts At the end of 2019, Karras Inc. had a debit balance of 141,120...
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Cordova, Incorporated, reported the following receivables in its December 31, 2023, year-end balance sheet:
| Current assets: | |
|---|---|
| Accounts receivable, net of $62,000 in allowance for uncollectible accounts | $ 394,000 |
| Interest receivable | 31,100 |
| Notes receivable | 510,000 |
Additional information:
- The notes receivable account consists of two notes, a $110,000 note and a $400,000 note. The $110,000 note is dated October 31, 2023, with principal and interest payable on October 31, 2024. The $400,000 note is dated March 31, 2023, with principal and 10% interest payable on March 31, 2024.
- During 2024, sales revenue totaled $2,220,000, $2,080,000 cash was collected from customers, and $51,000 in accounts receivable were written off. All sales are made on a credit basis.
Bad debt expense is recorded at year-end by adjusting the allowance account to an amount equal to 9% of year-end gross accounts receivable.
Required:
- In addition to sales revenue, what revenue and expense amounts related to receivables will appear in Cordova’s 2024 income statement?
- Calculate the receivables turnover ratio for 2024.
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