Reference no: EM133022212

Question 1 - Yong decided it would be helpful to discuss a couple of other transactions. On a recent trip to Paris, Yong met a street vendor who wanted to sell watches with the colors of various French futball teams. She paid Yong $3,000 in advance for the watches and promised him another $1,000 after she sells them. He did agree to take them back within two months if she found she could not sell them. This is a brand new market for him, so he is willing to take the risk in the hopes it will pay off. Yong shipped her all the watches three days ago. How much revenue should he record?

Question 2 - At the end of Yong's first year of business, he had been owed $70,000 and believed he would collect all but $3,000 of it. It is now the end of his second year of business. He is owed $90,000. Of that amount, $2,000 is from a customer who has told Yong the watches were stolen and they are not sure if they can pay. They are waiting to find out if their insurance will cover it. Yong does not know of any other specific amounts, but said that he expanded into a bunch of new markets, so he is worried that about $5,000 more may not pay. What amounts should he show on his balance sheet for receivables and on his income statement as an expense for his second year financial statements?

Balance sheet: $83,000

Income statement: $7,000

Balance sheet: $90,000

Income statement: $4,000

Balance sheet: $83,000

Income statement: $4,000

Balance sheet: $90,000

Income statement: $7,000

Question 3 - Crows Satellite Company has just published their financial statements for the current year. The face of the balance sheet shows accounts receivable of $8,000,000. There is also a note that says the company has an allowance for doubtful accounts of $100,000. How much do customers actually owe Crows?

Question 4 - Your friend Pablo owns company called "Essential Eats" (EE for short). EE makes baked goods using a free community kitchen. Pablo sells them at a local weekly sport park meet up. The sports park provides plates, napkins etc. This is a pretty good deal for Pablo as he only pays for the ingredients he uses to do the baking and a little bit of advertising.He said if he had to pay for the kitchen it would cost another $150 and the supplies like plates and napkins would add another $100.He sold $1,400 worth of baked goods this week. The ingredients cost him $500 and his advertising was $100. How much should Pablo show as cost of goods sold expense on his financial statements?