Question

According to its form 10-K, Hassell recorded bad debt expense of $104 and there were no bad debt recoveries during the current year.

	Current Year	Prior Year
Accounts receivable, net of allowances of $233 and $197	$14,389	$12,138
Net Sales Revenue	62,420	53,122

1. What amoung of bad debts was written off during the current year?

Allowance for doubtful accounts

	0	?	Beg. Balance
Write-offs	?	?	Bad Debt Expense
		?	End. Balance.

2. Based on your answer to requirement (1), solve for cash collected from customers for the current year, assuming that all of Hassell's sales during the period were an open account.

Accounts Receivable (Gross)

Beg. Balance	?	0
Net Sales.	?	?	Cash Collections
		?	Write-offs
End. Balance	?

Answer 1

$ Allowance for Doubtful Accounts 197 Beginning balance 104 Bad debt expense $ 233 Ending balance Write-offs 68 Beginning balance Net sales Accounts Receivable (Gross) $ 12,335 62,420 $ 60,065 Cash collections 68 Write-offs $ 14,622 Ending balance Beginning balance = $12,138 + $197 = $12,335 Ending balance = $14,389 + $233 = $14,622