ACCOUNTS RECEIVABLE

Question 1

Definition

Are financial assets because they represent a CONTRACTUAL RIGHT to receive cash ir another financial asset from another entity.

Answer 1

Receivables in general

Question 2

Measurement

What is the initial measurement of Receivables?

Answer 2

Fair Value + Transacation cost,

iba iba lang ang tawag sa other classification ng receivables.

Question 3

Measruement

What is the subsequent measurement of Receivables?

Answer 3

Amortized cost

Question 4

Term and definitions

Is a concept used in both the business and consumer worlds, refers to how loan repayments are divided between interest charges and reducing outstanding principal. This schedules determine how each payment is split based on factors such as the loan balance, interest rate and payment schedules.

Answer 4

Amortization

Question 5

Presentation

All trade and current non-trade receivables are presented in one line item in the current ass section of Statement financial position as

Answer 5

“Trade and other Receivables”

Question 6

Accounts Receivables

In computing invoice price, it should be net amount of TRADE DISCOUNT or VOLUME DIscount. , and net of Cash discounts if company using net method. If we have a term like this:

5, 10, 2/10, n/30 , what is the shortcut to compute for invoice price?

Answer 6

LIST PRICE x .95 x .98= INVOICE PRICE

Question 7

Differentiation

What is the difference between Trade Discount and Cash Discounts?

Question 8

Methods

What are the two methods in recording a receivable?

Answer 8

GROSS METHOD
NET METHOD

Question 9

Situational

Assuming we had sold Php 20,000 worth of ourr products on account. We gave the customer terms of 5, 10, 2/10 , n/30

How to we record the sales using GROSS METHOD?

GROSS METHOD

Answer 9

DEBIT : A/R—18,620
CREDIT: SALES—18,620

Question 10

Siuational

Assuming we had sold Php 20,000 worth of ourr products on account. We gave the customer terms of 5, 10, 2/10 , n/30

How to we record the collection, if the customer paid within discount period under GROSS METHOD?

GROSS METHOD

Answer 10

DEBIT-Cash—18,247.6
Sales discount—372.40
CREDIT–A/R–18,620

Question 11

Situational

Assuming we had sold Php 20,000 worth of ourr products on account. We gave the customer terms of 5, 10, 2/10 , n/30

How to we record the collection, if the customer paid beyond discount period under GROSS METHOD?

Answer 11

DEBIT-Cash–18,620
CREDIT–A/R–18,620

Question 12

IMPORTANT NOTE USING GROSS METHOD

If we use the gross method in recording, this title of journal entry arises.

Answer 12

SALES DISCOUNT, if the customer paid within the discount period, hence we can see this in the T-accounts of Accounts receivable in the ride side.