Reference no: EM131708844
Problem
Dreamer Company reported the "Receivables" account with a debit balance of P2,000.000 at year-end
The allowance for doubtful accounts had a credit balance of P50,000 on same date.
Subsidiary Details:
Trade Accounts Receivable 775,000
Trade Notes Receivable 100,000
Installments Receivable, normally due 1 to 2 years 300,000
Customers' accounts reporting credit balances arising from sales return (30,000)
Advance payments for purchase of merchandise 150,000
Customers' accounts reporting credit balances arising from advance payments (20,000)
Cash advance to subsidiary 400,000
Claim from insurance entity 15,000
Subscriptions receivable due in 60 days 300,000
Accrued interest receivable 10,000
Total 2,000,000
Required:
a. Prepare Compound entry to reclassify receivables account
b. Calculate the amount to be presented as "trade and other receivables" under current assets
c. Indicate classification and presentation of other items excluded from "trade and other receivables"