4.Montana Company reported accounts receivable at the end of 2007 of $6,000,000 before allowing for doubtful accounts. During 2008, it recorded sales of $28 million on credit and collected $29 million from customers. At the end of 2008, before adjustments, Montana had a $180,000 balance in allowance for doubtful accounts and estimated that it required an allowance equal to 6% of accounts receivable.
Required:
a. What was the net amount of accounts receivable reported on the 2008 balance sheet?
b. What amount of doubtful accounts expense did Montana report for 2008?
5.Mollini Corporation sold merchandise with a sales price of $35 million during 2007. Mollini allowed its customers $5 million of quantity discounts. Mollini expects a return rate of 5% of the amount billed, after the discount is applied. How much revenue (after discounts and returns) should Mollini report for 2007?
6.On November 10, Roberts Distributors purchased 4,000 tables at an invoice price of $300 each and paid for them on November 20, earning a 3% cash discount. Roberts sold all of the tables at $500 each. The customer earned a 1% cash discount.
Required:
a. What amount should Roberts report as net sales?
b. What amount should Roberts report as cost of goods sold?