Solution 1:
Journal Entry 1 - Raintree Cosmetic Company | |||
Event | Particulars | Debit | Credit |
1 | Allowance for doubtful accounts Dr | $52,000.00 | |
To Accounts receivables | $52,000.00 | ||
(To written of accounts receivables) | |||
2 | Accounts receivables Dr | $4,300.00 | |
To Allowance for doubtful accounts | $4,300.00 | ||
(To reinstate account previously written off) | |||
3 | Cash Dr | $4,300.00 | |
To Accounts receivables | $4,300.00 | ||
(To record collection of accounts previously written off) |
Solution 2:
Ending balance in accounts receivables = Beginning receivables + Credit sales - Collection - Write off
= ($497,000 + $43,000) + $1,815,000 - $1,895,000 - $52,000
= $408,000
Ending balance in allowance for doubtful accounts before adjusting entry = Beginning balance - Write off + Bad debts recovered previously written off
= $43,000 - $52,000 + $4,300 = $4,700 debit
Computation of Allowance for Uncollectible Accounts | ||||
Ageing | % of year end receivables in Group | Accounts Receivables | % Uncollectible | Required Allowance |
0-60 days | 60% | $244,800 | 3% | $7,344 |
61-90 days | 10% | $40,800 | 5% | $2,040 |
91-120 days | 20% | $81,600 | 25% | $20,400 |
Over 120 days | 10% | $40,800 | 45% | $18,360 |
Total | $408,000 | $48,144 |
Journal Entry 2 - Raintree Cosmetic Company | |||
Event | Particulars | Debit | Credit |
a | Bad debts Expense Dr ($1,815,000*2%) | $36,300.00 | |
To Allowance for doubtful accounts | $36,300.00 | ||
(To record bad debts expense) | |||
b | Bad debts Expense Dr ($408,000*10% + $4,700) | $45,500.00 | |
To Allowance for doubtful accounts | $45,500.00 | ||
(To record bad debts expense) | |||
c | Bad debts Expense Dr ($48,144 + $4,700) | $52,844.00 | |
To Allowance for doubtful accounts | $52,844.00 | ||
(To record bad debts expense) |
Solution 3:
a. Net accounts receivables = $408,000 - ($36,300 - $4,700) = $376,400
b. Net accounts receivables = $408,000 - $40,800 = $367,200
c. Net accounts receivables = $408,000 - $48,144 = $359,856
Thanks for helping with this Accounting problem. Please answer all three requirements ... thank you Raintree...
Only #2b, c, and 3 please Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $42,000 $ 492,000 During 2021, credit sales were $1,810,000, cash collections from customers $1,890,000, and $51,000 in accounts receivable were written off. In addition, $4,200 was collected from...
Check my workCheck My Work button is now enabled1 Item 2 Item 2 20 points Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company’s fiscal year-end. The 2020 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $43,000 $ 497,000 During 2021, credit sales were $1,815,000, cash collections from customers $1,895,000, and $52,000 in accounts receivable...
I just need help with requirement three! Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $30,000 $432,000 During 2021, credit sales were $1,750,000, cash collections from customers $1,830,000, and $35,000 in accounts receivable were written off. In addition, $3,000 was collected from...
Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Current assets: $ 487.000 Receivables, net of allowance for uncollectible accounts of $41,000 During 2021, credit sales were $1,805,000, cash collections from customers $1,885,000, and $50,000 in accounts receivable were written off. In addition, $4,100 was collected from a customer whose account was written...
Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $30,000 $432,000 During 2021, credit sales were $1,750,000, cash collections from customers $1,830,000, and $35,000 in accounts receivable were written off. In addition, $3,000 was collected from a customer whose account was written off...
Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $33,000 $ 447,000 During 2021, credit sales were $1,765,000, cash collections from customers $1,845,000, and $38,000 in accounts receivable were written off. In addition, $3,300 was collected from a customer whose account was written...
Could you please help me to figure out the answer for required 3? I don't know why it showed wrong. Thank you so much! Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare the year-end adjusting entry for bad debts. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) No Transaction General Journal Debit Credit 53,700 Bad debt expense Allowance for uncollectible...
Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $46,000 512,000 During 2021, credit sales were $1,830,000, cash collections from customers $1,910,000, and $55,000 in accounts receivable were written off. In addition, $4,600 was collected from a customer whose account was written off...
Problem 7-4 Uncollectible accounts [LO7-5, 7-6] Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company’s fiscal year-end. The 2017 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $30,000 $432,000 During 2018, credit sales were $1,750,000, cash collections from customers $1,830,000, and $35,000 in accounts receivable were written off. In addition, $3,000 was collected from a...
Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Current assets Receivables, net of allowance for uncollectible accounts of $36,000 $462,000 During 2021, credit sales were $1,780,000, cash collections from customers $1,860,000, and $41,000 in accounts receivable were written off. In addition, $3,600 was collected from a customer whose account was written off...