Cordova, Inc

question 92

Essay

Cordova, Inc., reported the following receivables in its December 31, 2017, year-end balance sheet:

Additional information:
1. The notes receivable account consists of two notes, a $100,000 note and a $300,000 note. The $100,000 note is dated October 31, 2017, with principal and interest payable on October 31, 2018. The $300,000 note is dated March 31, 2017, with principal and 8% interest payable on March 31, 2018.
2. During 2018, sales revenue totaled $2,120,000, $1,980,000 cash was collected from customers, and $41,000 in accounts receivable were written off. All sales are made on a credit basis. Bad debt expense is recorded at year-end by adjusting the allowance account to an amount equal to 8% of year-end gross accounts receivable.
Required:
1. In addition to sales revenue, what revenue and expense amounts related to receivables will appear in Cordova's 2018 income statement?
2. Calculate the receivables turnover ratio for 2018.

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Definitions:

Dendrites

The branched projections of a neuron that receive electrochemical signals from other neural cells and transmit these signals toward the cell body.

Newborn Sleeps

Refers to the sleep patterns and behaviors of newborns, often characterized by short cycles of sleep and wakefulness throughout a 24-hour period.

Hours

Units of time equivalent to 60 minutes, used to measure the duration of events or the length of the day.

Day

A period of 24 hours as a unit of time, representing one complete rotation of the Earth on its axis, commonly divided into daytime and nighttime.