Nova company reported the following receivables on December 31, 2020:Accounts receivable, net of P500,000 allowancefor doubtful accounts4,600,000190,000Interest receivableNotes receivable4,000,000* The notes receivable comprised:P1,000,000 note dated October 31, 2020, with principal and interest payable onOctober 31, 2021.P3,000,000 note dated March 31, 2020 , with principal and 8% interest payableon March 31, 2021* During 2021, sales revenue totaled P21,000,000, P18,000,000 cash was collectedfrom customers, and accounts receivable of P600,000 were written off. All saleswere made on a credit basis.* Doubtful accounts expense was recorded at year-end by adjusting the allowanceaccount to an amount equal to 10% of year-end accounts receivable.What amount should be reported as interest income for 2021?A.110,000B.240,000C.60,000D.80,000

Solution: Particulars Amount P3,000,000 x 8% x3/12 60.000 P1,000,000 x 6% X10/12 50,000…

Nova company reported the following receivables on December 31, 2020: Accounts receivable, net of P500,000 allowance for doubtful accounts 4,600,C Interest receivable 190,0 Notes receivable 4,000,0 * The notes receivable comprised: P1,000,000 note dated October 31, 2020, with principal and interest p October 31, 2021. P3,000,000 note dated March 31, 2020 , with principal and 8% interes on March 31, 2021 * During 2021, sales revenue totaled P21,000,000, P18,000,000 cash wa from customers, and accounts receivable of P600,000 were written of were made on a credit basis. Doubtful accounts expense was recorded at year-end by adjusting the account to an amount equal to 10% of year-end accounts receivable. What amount should be reported as interest income for 2021?

Nova company reported the following receivables on December 31, 2020: Accounts receivable, net of P500,000 allowance for doubtful accounts 4,600,C Interest receivable 190,0 Notes receivable 4,000,0 * The notes receivable comprised: P1,000,000 note dated October 31, 2020, with principal and interest p October 31, 2021. P3,000,000 note dated March 31, 2020 , with principal and 8% interes on March 31, 2021 * During 2021, sales revenue totaled P21,000,000, P18,000,000 cash wa from customers, and accounts receivable of P600,000 were written of were made on a credit basis. Doubtful accounts expense was recorded at year-end by adjusting the account to an amount equal to 10% of year-end accounts receivable. What amount should be reported as interest income for 2021?

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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