Question

Use the following to answer questions 8-11 The following information pertains to JR, Inc. for the month of November: Credit sales Accounts payable Accounts receivable Allowance for Uncollectible accounts Cash sales $700,000 42,000 68,000 600 200,000 credit JR uses the percent of receivables method and estimates it will not collect 5% of accounts receivable. Chapter 5 Page 5-1 8. $ Determine the ending balance for the Allowance for Uncollectible Accounts 9. $_ Determine the appropriate amount to record for Bad Debt expense 10. $. Assuming the Allowance for Uncollectible accounts had a $200 debit balance instead, determine the amount to record for Bad Debt expense 11. $ After recording bad debt expense the Net Accounts Receivable is:

Answer 1

8.

Ending balance for the allowance for Uncollectible accounts ($68,000*5%)

$ 3,400

9.

Baddebt expenses ($3,400-$600)

$ 2,800

10.

Baddebt expenses ($3,400+$200)

$ 3,600

11.

Accounts receivable	$ 68,000
Less: Allowance for doubtful accounts	$ -3,400
Net accounts receivable	$ 64,600

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