Introduction to Financial Accounting unit 3

Answer 4 questions,  Question 1 Explain how and where accounts receivable are reported on the financial statements, and what the difference is between accounts receivable and notes receivable. Question 2 John Snow’s chequebook lists the following: Prepare John Snow’s bank reconciliation at November 30th. Question 3 Digital Solutions Inc is preparing its cash collection summary for 2018. Digital ended 2017 with cash of $81 million, and managers need to keep a cash balance of at least $75 million for operations. Account Receivables are expected to total $11,284 million during 2018, and payments for the cost of services should reach $6,166 million. Estimate bad debt expense will be at $2,543 million. During 2018, Digital expects to invest $1,825 million in new equipment and sell older assets for $115 million. Debt payments scheduled for 2018 will total $597 million. The company forecasts net income of $890 million for 2018 and plans to pay dividends of $338 million. Prepare Digital Solutions cash balance for 2018. Will the cash receipts and payments leave Digital with the desired ending cash balance of $75 million, or will the company need additional financing? If it does, how much will it need? Hint: cash collections – cash payments = ending cash – desired balance = financing (if needed) Question 4 The October 31 bank statement of Spooky Halloween Costumes Ltd. (SHC) has just arrived from TD Bank. To prepare the SHC bank reconciliation, you gather the following data: SHC’s Cash account shows a balance of $2,256.14 on October 31. The October 31 bank balance is $4,023.05. The bank statement shows that SHC earned $38.19 of interest on its bank balance during October. This amount was added to SHC’s bank balance. SHC pays utilities of $250 and insurance of $100 by EFT. The following SHC cheques did not clear the bank by October 31