FIN 300 Lecture Notes - Lecture 7: Current Asset, Accounts Receivable, Deferral

16 views1 pages

purplejellyfish519

5 Mar 2021

School

Department

Course

Professor

For unlimited access to Class Notes, a Class+ subscription is required.

Document Summary

Looking at accounts receivable; the rights to receive cash in the future from your customers. Only record transaction under this account when the goods become the property of the customer (regardless if they paid for it yet or not) Listed as a current asset; before inventory and any prepaid expenses. Businesses sell on credit to be competitive; they record transactions with credit on accounts receivable and list it as a current asset and as revenue on the balance sheet. Account for doubtful accounts: recording transactions and the amount of money you think, will not be collectable from your total accounts receivable. Ex you have ,000 in accounts receivable; ,000 is the amount you think/know that you cant collect money from. So ,000 is recorded in the allowance for doubtful accounts.

Related Questions

Tonyâs favorite memories of his childhood were the times he spent with his dad at camp. Tony was daydreaming of those days a bit as he and Suzie jogged along a nature trail and came across a wonderful piece of property for sale. He turned to Suzie and said, âIâve always wanted to start a camp where families could get away and spend some quality time together. If we just had the money, I know this would be the perfect place.â They called several banks and on January 1, 2014, Great Adventures obtained $570,000, 6%, 9-year installment loan from Summit Bank. Monthly payments of $6,843 are required at the end of each month over the life of the 9-year loan. Each monthly payment of $6,843 includes both interest expense and principal payments (i.e., reduction of the loan amount.)

Late that night Tony exclaimed, "$570,000 for our new camp, this has to be the best news ever.â Suzie snuggled close and said, âThereâs something else I need to tell you, Tony, Iâm expecting!â They decided right then, if it was a boy, they would name him Venture.

1.
value:
10.00 points
Required information

Required:

Complete the first three rows of an amortization table. (Round your final answers to the nearest dollar amount. Omit the "$" sign in your response.)

Date Cash
Paid Interest
Expense Decrease in
Carrying
Value Carrying
Value
1/1/14 $
1/31/14 $ $ $
2/28/14

References
eBook & Resources
WorksheetDifficulty: Hard
Check my work

2.
value:
10.00 points
Required information

Record the note payable on January 1, 2014, and the first two payments on January 31, 2014, and February 28, 2014. (Do not round intermediate calculations. Round your final answers to the nearest dollar amount. Omit the "$" sign in your response.)

Date General Journal Debit Credit
Jan.1, 2014
(Click to select)
Notes payable
Accounts receivable
Interest payable
Interest revenue
Notes receivable
Accounts payable
Interest expense
Cash

(Click to select)
Accounts receivable
Accounts payable
Interest expense
Interest revenue
Notes receivable
Cash
Interest payable
Notes payable

Jan.31, 2014
(Click to select)
Notes payable
Interest expense
Interest revenue
Notes receivable
Accounts payable
Cash
Interest payable
Accounts receivable

(Click to select)
Accounts receivable
Interest payable
Notes receivable
Interest revenue
Notes payable
Cash
Accounts payable
Interest expense

(Click to select)
Accounts payable
Interest expense
Interest payable
Interest revenue
Cash
Accounts receivable
Notes receivable
Notes payable

Feb.28, 2014
(Click to select)
Notes receivable
Interest revenue
Interest payable
Accounts receivable
Interest expense
Notes payable
Accounts payable
Cash

(Click to select)
Interest payable
Notes receivable
Notes payable
Interest expense
Cash
Accounts receivable
Interest revenue
Accounts payable

(Click to select)
Accounts payable
Notes receivable
Interest expense
Notes payable
Accounts receivable
Interest revenue
Cash
Interest payable

References
eBook & Resources

taupeworm791

please help me answer these questions.

1. Describe in three sentences or less the primary differences between the income statement and the balance sheet of a company.

2. You are a supplier of equipment and a customer asks for payment terms. They have a large order pending and want to pay you in 60 days. You conduct a financial statement review and you see that this customer has some cash on the balance sheet, (but less than the amount he is purchasing from you), he has a high balance of accounts receivable on the balance sheet, but they carry a very low inventory balance. You look at the Current Ratio, the Quick Ratio, the Fixed Asset Turnover Ratio and the Accounts Receivable Turnover Ratio. Of these ratios, what is the two most useful ratios and explain in 3-4 sentences why you would focus on these two ratios? Also, which is the least useful ratio of these four for this particular situation?

3. George's tire shop pays $10,000 a month in rent, $1,000 a month in utilities and $8,000 per month on administrative payroll. They sell one type of tire and it sells for $100 per tire. George's Tore shop pays its supplier $60 per tire. Property taxes for the year are $12,000. In order for George's Tire Shop to break even, they need to average how many tires sold every month over the next year?

viridiancheetah434

1. Discuss the importance of financial statements and how they are used by businesses.

2. What is the basic format of the income statement and what is the relevance of the basic categories?

3. Cash flows for an organization come from operating activities and investment activities. Discuss the importance of each to the organization.

The Happy Auto Shop has the following annual information:

Gross Sales	$700,000
Net sales	$696,000
Gross profit	$448,000

What are the shopâs returns and allowances and cost of goods sold?

Construct a statement of financial position (balance sheet) for the Humperdink family using the following information:

cash	$50
Checking account	$2,500
student loan balance	$6,000
stocks and bonds	$2,600
savings account	$5,850
residence	$110,000
automobile	$12,000
savings account	$5,800
automobile loan balance	$12,000
401K retirement account	$15,000
furniture, clothing, jewelry	$8,000
credit card balance	$4,000
mortgage loan balance	$99,000

What is the purpose of financial statement analysis? How do the three types of financial statement analysis differ from each other and when is each used?

Samantha Knight is applying for a small-business loan. She provides the bank with the following information:

cash in checking accounts	$5,000
cash in savings	$10,350
home market value	$145,500
first mortgage on house	$25,000
home equity loan limit	$70,000
home equity loan	$10,000
automobile market value	$19,000
automobile loan outstanding	$15,000
credit card debt	$1,500

Calculate the debt-to-asset ratio.

Calculate the debt-to-equity ratio.

What percentage of Samantha's assets is owned by others?

Given the profit loss (income statement) and balance sheet for Sam's Sandwich Delivery (Table 4-8, page 121 of your textbook), answer the following:

Calculate the following ratios: current, quick, accounts receivable turnover, fixed asset turnover.

Using the inventory figure on the balance sheet as average inventory, calculate the inventory turnover ratio.

Calculate the debt-to-equity ratio, debt-to-total asset ratio, and operating profit margin ratio.

Perform a vertical analysis of the income statement.

Perform a vertical analysis of the balance sheet.

Based on your analysis, would you consider investing in Sam's Sandwich Delivery?

maroonporpoise597

FIN 300 Lecture Notes - Lecture 7: Current Asset, Accounts Receivable, Deferral

Document Summary

Get access

Related Documents

FIN 300 Study Guide - Midterm Guide: Dividend Payout Ratio

FIN 300 Chapter Notes - Chapter n/a: Profit Margin, Earnings Before Interest And Taxes, Retained Earnings

FIN 300 Study Guide - Final Guide: Dividend Payout Ratio, Promissory Note, Quick Ratio

Related Questions