Question

Janway Company sells softball equipment. On November 14, they shipped $1,000 worth of softball uniforms to Chris Middle School, terms 2/10, n/30. On November 21, they received an order from Douglas High School for $600 worth of custom printed bats to be produced in December. On November 30, Chris Middle School returned $100 of defective merchandise. Janway has received no payments from either school as of month end. What amount will be recognized as net accounts receivable on the Balance Sheet as of November 30?

Answer 1

Answer: The net accounts receivable on the Balance Sheet as of November 30 can be calculated as follows:

First, calculate the accounts receivable balance for each school:

For Chris Middle School:

Total invoice amount = $1,000

Less: Amount of returns = $100

Net amount due = $900

Less: 2% discount for early payment = $18 (2% of $900)

Amount due within discount period = $882

For Douglas High School:

Amount due = $600

Total accounts receivable balance = $882 + $600 = $1,482

Therefore, the net accounts receivable on the Balance Sheet as of November 30 is $1,482.

Step-by-step explanation: