RAPPLER HOLDINGS CORPORATION'S Accounts Receivable Subsidiary Ledger Shows The Following
RAPPLER HOLDINGS CORPORATION'S Accounts Receivable Subsidiary Ledger Shows The Following
information:
ACCOUNT INVOICE
BALANCE
CUSTOMER DEC. 31, 2016 DATE AMOUNT
Mocha, Inc. P35,180 12/06/16 P14,000
11/29/16 21,180
Andanar Co. 20,920 9/27/16 12,000
8/20/16 8,920
Alvarez Corp. 30,600 12/08/16 20,000
10/25/16 10,600
Win Co. 45,140 11/17/16 23,140
10/09/16 22,000
EX-B Co. 31,600 12/12/16 19,200
12/02/16 12,400
Isabelle Co. 17,400 09/12/16 17,400
The estimated bad debt rates below are based on RAPPLER HOLDINGS CORPORATION’S receivable
collection experience.
Age of Accounts Rate
0 – 30 days 1%
31 – 60 days 1.5%
61 – 90 days 3%
91 – 120 days 10%
Over 120 days 50%
The allowance for bad debts account had a debit balance of P5,500 on December 31, 2016, before
adjustment.
1. The company’s accounts receivable under “61-90days” category should be
A. P32,600 C. P44,600
B. P44,320 D. P42,000
2. The company’s accounts receivable under “91-120days” category should be
A. P38, 320 C. P29,400
B. P40,000 D. P12,000
3. The allowance for bad debts to be reported in the statement of financial position at December
31, 2016, is
A. P9,699 C. P4,199
B. P15,199 D. P9,669
4. What entry should be made on December 31, 2016, to adjust the allowance for bad debts
account?
A. Bad debt expense 15,199
Allowance for bad debts 15,199
B. Bad debt expense 4,199
Allowance for bad debts 4,199
C. Allowance for bad debts 5,500
Bad debt expense 5,500
D. Bad debt expense 9,699
Allowance for bad debts 9,699
5. What is the net realizable value of accounts receivable at December 31, 2016?
A. P165, 641 C. P196,039
B. P171,141 D. P186,340
RAPPLER HOLDINGS CORPORATION
ACCOUNTS RECEIVABLE AGING SCHEDULE
December 31, 2016
3. Answer: A
4. Bad debt expense 15,199
Allowance for bad debts 15,199