Reference no: EM132484472

Question 1 - The following information is available for Edmiston Company.

Beginning accounts receivable $70,000

Ending accounts receivable 110,000

Net sales 970,000

Compute the average collection period (days sales in A/R). Use a 360 day year or 30 day month. (Round average collection period to 1 decimal place).

Question 2 - Shelton Company uses the allowance method for estimating uncollectible accounts.

January 5 Sold merchandise to Luke Ryan for $1,700, terms n/15.

April 15 Received $500 from Luke Ryan on account.

August 21 Wrote off as uncollectible the balance of the Luke Ryan account when he declared bankruptcy.

October 5 Unexpectedly received a check for $600 from Luke Ryan. It is not felt any more will be received from Ryan.

Prepare journal entries to record the above transactions.

Question 3 - The cost of land includes all of the following except

a. parking lots

b. accrued property taxes

c. real estate commissions

d. closing costs

Question 4 - On March 1, 2021, Landon Company acquired real estate on which it planned to construct a small office building. The company paid $95,000 in cash. An old warehouse on the property was razed at a cost of $8,100; the salvaged materials were sold for $1,700. Additional expenditures before construction began included $1,100 attorney's fee for work concerning the land purchase, $4,000 real estate broker's fee, $7,800 architect's fee, and $14,000 to put in driveways and a parking lot. Determine the amount to be reported as the cost of the land.