Question

Interpreting the Accounts Receivable Footnote
Hewlett-Packard Company reports the following in its 2015 10-K report.

October 31 (in millions)	2015	2014
Accounts receivable	$13,363	$13,832

Footnotes to the company's 10-K provide the following additional information relating to its allowance for doubtful accounts.

For the fiscal years ended October 31 (in millions)	2015	2014	2013
Allowance for doubtful accounts-accounts receivable
Balance, beginning of period	$232	$332	$464
Provision for doubtful accounts	46	25	23
Deductions, net of recoveries	(89)	(125)	(155)
Balance, end of period	$189	$232	$332

(a) What is the gross amount of accounts receivables for Hewlett-Packard in fiscal 2015 and 2014?

($ millions)	2015	2014
Gross accounts receivable	Answer	Answer

(b)What is the percentage of the allowance for doubtful accounts to gross accounts receivable for 2015 and 2014? (Round your answers to two decimal places.)

($ millions)	2015	2014
Percentage of uncollectible accounts to gross accounts receivable(d)Compute Hewlett-Packard's write-offs as a percentage of the allowance account at the beginning of the year. (Round your answers to two decimal places) 2015 write-offs as a percentage of beginning of year allowance: Answer % 2014 write-offs as a percentage of beginning of year allowance: Answer % 2. Revenue Recognition: We generally recognize sales, net of estimated returns, at the time the member takes possession of merchandise or receives services. When we collect payment from customers prior to the transfer of ownership of merchandise or the performance of services, the amount recieved is generally recorded as deferred revenue on the consolidated balance sheets until the sales or service is completed. Membership fee revenue represents annual membership fees paid by our memberships. We account for membership fee revenue, net of estimated refunds, on a deferred basis, whereby revenue is recognized ratably over the one-year membership period. Revenue ($ millions) August 28, 2016 August 30, 2015 August 31, 2014 Net Sales $116,073 $113,666 $110,212 Membership fees 2,646 2,533 2,428 Total revenue $118,719 $116,199 $112,640 Current Liabilities ($ millions) August 28, 2016 August 30, 2015 Accounts payable $7,612 $9,011 Current portion of long-term debt 1,100 1,283 Accrued salaries and benefits 2,629 2,468 Accured member rewards 869 813 Deferred membership fees 1,362 1,269 Other current liabilities 2,003 1,695 Total current liabilities $15,575 $16,539 (b) Use the balance sheet information on Costco's Deferred Membership Fees liability account and its income statement revenues related to Membership Fees earned during 2016 to compute the cash that Costco received during 2016 for membership fees. Total cash received (in $ millions) = $Answer Balance Sheet Transaction ($ millions) Cash Asset + Noncash Assets = Liabilities + Contributed Capital + Earned Capital Receive cash in advance for membership fees Answer Answer Answer Answer Answer	Answer %	Answer %

Answer 1