Question

The following information is taken from the 2015 annual report to shareholders of Hughe-Pockets (HP) Co. For Fiscal 2015 For Fiscal 2014 Provision for doubtful accounts $ 36 million $ 113 million At Fiscal Year-end 2015 At Fiscal Year-end 2014 Accounts receivable, net 15,941 million 16,472 million Accounts receivable, gross 16,338 million 17,001 million What is the balance in HP's allowance for doubtful accounts at the end of the fiscal years 2015 and 2014, respectively

Answer 1

Answer:

2015 balance = $35,603,000

2014 balance = $112,471,000

Explanation:

GIVEN the following ;

YEAR 2015:

Provision for doubtful ACCOUNT = $36,000,000

Account receivable(NET) = $15,941,000

Account receivable(GROSS) = $16,338,000

Allowance for doubtful account = Account receivable(GROSS) - Account receivable(NET)

$16,338,000 - $15,941,000 = $397,000

Allowance for doubtful account BALANCE = $36,000,000 - $397,000 = $35,603,000

YEAR 2014:

Provision for doubtful ACCOUNT = $113,000,000

Account receivable(NET) = $16,472,000

Account receivable(GROSS) = $17,001,000

Allowance for doubtful account = Account receivable(GROSS) - Account receivable(NET)

$17,001,000 - $16,472,000 = $529,000

Allowance for doubtful account BALANCE = $113,000,000 - $529,000 = $112,471,000