PROBLEM 10: The purchases joumal of YYY Enterprises shows the following invoices: Invoice Invoice Date Number FOB Term Amount DECEMBER 2021 251 Date Received 23-Dec Des tination Destination Shipping point Shipping point Destination Destination Shipping point Shipping point Destination Destination P20,000 24-Dec 252 253 254 255 256 257 258 259 260 24,000 16,000 18,000 27,000 21,000 2,000 50,000 12,000 22,000 23-Dec 26-Dec 26-Dec 2-Jan 31-Dec 27-Dec 29-Dec 30-Dec 5-Jan 31-Dec 4-Jan 21-Dec 2-Jan 28-Dec 27-Dec 8-Jan 22-Dec 28-Dec JANUARY 2022 261 262 P30,000 Destination Destination Shipping point Shipping point Shipping point Destination 4-Jan 24,000 15,000 6,500 8,500 19,000 28-Dec 29-Dec 30-Dec 2-Jan 28-Dec 30-Dec 28-Dec 31-Dec 5-Jan 4-Jan 6-Jan 263 264 265 266 11. How much of these invoices must be reported as part of inventory?
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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