Question

At December 31, Folgeys Coffee Company reports the following results for its calendar year. Cash sales Credit sales 900,000 зее, оее Its year-end unadjusted trial balance includes the following items. Accounts receivable Allowance for doubtful accounts $125,000 debit 5,000 debit Prepare the adjusting entry to record bad debts expense assuming uncollectibles are estimates total sales and (c) 6% of year-end accounts receivable. View transaction list Journal entry worksheet < 1 2 Record Bad Debts Expense assuming uncollectibles are estimated to be 3% of credit sales.

Answer 1

Credit sales	$            900,000
Cash sales	$            300,000
Total sales	$        1,200,000
Part A
Bad debt expense (900000*3% of credit sales)	$              27,000
Part B
Bad debt expense (percentage of total sales is missing. Provide the percentage of total sales) (Amount = 1200000*Percentage of total sales)	XXXX
Part C
Allowance of doubtful account (credit balance) after adjustment (125000*6%)	$                7,500
Add: Allowance of doubtful account (debit balance) available before adjustment (debit balance means extra adjustment required to made.)	$                5,000
Adjustment of bad debts expense	$              12,500

Adjustment entries
Transaction	Date	General journal	Debit	Credit
(a)	December 31	Bad debts expense	27,000
		Allowance of doubtful account		27000
		(To record Bed debts expense.)
(b)	December 31	Bad debts expense	XXXX
		Allowance of doubtful account		XXXX
		(To record Bed debts expense.) (Amount = 1200000*Percentage of total sales)
(c)	December 31	Bad debts expense	$           12,500
		Allowance of doubtful account		12500
		(To record Bed debts expense.)