Question

Complete the requirements for each of the following independent cases:    

Case A. Dr Pepper Snapple Group, Inc., is a leading integrated brand owner, bottler, and distributor of nonalcoholic beverages in the United States, Canada, and Mexico. Key brands include Dr. Pepper, Snapple, 7-UP, Mott’s juices, A&W root beer, Canada Dry ginger ale, Schweppes ginger ale, and Hawaiian Punch, among others.

   
The following represents selected data from recent financial statements of Dr Pepper Snapple Group:    

DR PEPPER SNAPPLE GROUP, INC. Consolidated Balance Sheets (partial)
(in millions)	December 31, 2014					December 31, 2013
Assets
Current assets:
Cash and cash equivalents		$	218				$	58
Accounts receivable (net of allowances of $19 and $26, respectively)			523					540

Consolidated Statements of Income (partial)
	For the Year Ended December 31
(In millions)	2014			2013			2012
Net sales	$	5,660		$	5,536		$	5,534
Net income	$	710		$	645		$	650

    
The company also reported bad debt expense of $7 million in 2014, $13 million in 2013, and $9 million in 2012.    

1. Record the company’s write-offs of uncollectible accounts for 2014. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

    
2. Assuming all sales were on credit, what amount of cash did Dr Pepper Snapple Group collect from customers in 2014? (Enter your answers in millions.)

Answer 1

1. write-offs of uncollectible accounts for 2014 = Beginning balance in allowances for uncollectible accounts + bad debts expense for the year - ending balance in allowances for uncollectible accounts

= 26+7-19 = $14 million

Accounts	Debit	Credit
Allowances for uncollectible accounts	$14 million
Accounts receivable		$14 million

2. Collection from customer = Beginning accounts receivables + credit sales - written off amount - ending balance in accounts recevables

= (540+26)+5660-14-(523+19)

= $5670 million