Reference no: EM132470188

Receivables on the Balance Sheet

Question 1: Identify any errors in the following partial balance sheet.

                           Napa Vino Company

                              Balance Sheet

                            December 31, 20Y9

                                  Assets

Current assets:

Cash                                                           $78,500

Notes receivable                                          $300,000

Less interest receivable                                     4,500 295,500

Accounts receivable                                       $1,200,000

Plus allowance for doubtful accounts                 11,500 1,211,500

The interest receivable should be:

A. added to the notes receivable

B. reported separately as a current asset

C. shown on the income statement revenue

D. deducted from accounts receivable

The allowance for doubtful accounts should be:

A. added to the notes receivable

B. reported separately as a current asset

C. shown on the income statement revenue

D. deducted from accounts receivable