Write-Off of Uncollectible Accounts The Rock has credit sales of $480,000 during 2019 and estimates at...
Write-Off of Uncollectible Accounts The Rock has credit sales of $480,000 during 2019 and estimates at the end of 2019 that 2% of these credit sales will eventually default. Also, during 2019 a customer defaults on a $1,900 balance related to goods purchased in 2019. Required: 1. Prepare the journal entry to record the defaulted balance. Allowance for Doubtful Accounts Accounts Receivable Record write-off of defaulted account 2. Prepare the adjusting entry to record the bad debt expense for 2019. Bad Debt Expense Allowance for Doubtful Accounts Record adjusting entry for bad debt expense estimate
Homework Answers
Answer :-
1. Journal entry to record the defaulted balance :-
Allowance for doubtful accounts a/c Dr $1,900
To Accounts Receivable A/c. $1,900
2.The adjusting entry to record the bad debt expense for 2019 :-
Bad debt expense a/c Dr $9,600
To Allowance for doubtful accounts A/c $9,600
( $480,000 * 2% = $9,600)
If you have any query do comment I will try to resolve asap. Thanks
Add Answer to:
Write-Off of Uncollectible Accounts The Rock has credit sales of
$480,000 during 2019 and estimates at...
cornerstone Exercise 5-25 (Algorithmic) Percentage of Credit Sales Clarissa Company has credit sales of $522,000 during...
cornerstone Exercise 5-25 (Algorithmic) Percentage of Credit Sales Clarissa Company has credit sales of $522,000 during 2019 and estimates at the end of 2019 that 2.5% of these credit sales will eventually default. Also, during 2019 a customer defaults on a $770 balance related to goods purchased in 2018. Prior to the write-off for the $770 default, Clarissa's accounts receivable and allowance for doubtful accounts balances were $402,000 and $129 (credit), respectively, Required: - 1. Prepare the journal entry to...
5. The Lowery Co. uses the direct write-off method of accounting for uncollectible accounts receivable. Lowery...
5. The Lowery Co. uses the direct write-off method of accounting for uncollectible accounts receivable. Lowery has a customer whose accounts receivable balance has been determined to likely be wrotestable The entry to write off this account would be which oflua following?: a. debit Sales Returns and Allowance, credit Accounts Receivable b. debit Bad Debt Expense; credit Allowance for Doubtful Accounts c. debit Allowance for Doubtful Accounts; credit Accounts Receivable. d. debit Bad Debt Expense; credit Accounts Receivable Abbott Company...
Credit Debit $195,800 Accounts Receivable Allowance for Doubtful Accounts Sales Revenue $ 1,480 903,200 (a) Prepare...
Credit Debit $195,800 Accounts Receivable Allowance for Doubtful Accounts Sales Revenue $ 1,480 903,200 (a) Prepare the adjusting entry at December 31, 2022, to record bad debt expense, assuming that the aging schedule indicates that $10,290 of accounts receivable will be uncollectible. (b) Repeat part (a), assuming that instead of a credit balance there is a $1,480 debit balance in Allowance for Doubtful Accounts. (c) During the next month, January 2023, a $2,270 account receivable is written off as uncollectible....
In this module, you will learn how to estimate and report the effects of uncollectible accounts....
In this module, you will learn how to estimate and report the effects of uncollectible accounts. Under Generally Accepted Accounting Principles, or GAAP companies must use the allowance method to account for uncollectibles. This method involves the following steps: 1. Estimate and record uncollectibles with an end-of-period adjusting journal entry that increases Bad Debt Expense (debit) and increases the Allowance for Doubtful Accounts (credit). 2. Identify and write off specific customer balances in the period that they are determined to...
Aging Method On January 1, 2019, Smith, Inc., has the following balances for accounts receivable and...
Aging Method
On January 1, 2019, Smith, Inc., has the following balances for
accounts receivable and allowance for doubtful accounts:
Accounts Receivable
$376,000
Allowance for Doubtful Accounts (a credit balance)
4,200
During 2019, Smith had $2,860,000 of credit sales, collected
$2,905,000 of accounts receivable, and wrote off $3,850 of accounts
receivable as uncollectible. At year end, Smith performs an aging
of its accounts receivable balance and estimates that $3,800 will
be uncollectible.
Cornerstone Exercise 5-28 (Algorithmic) Aging Method On January...
Accounts receivable $410,000 Unadjusted Allowance for doubtful accounts $10,200 Sales (all on credit) 910,000 a) Prepare...
Accounts receivable $410,000 Unadjusted Allowance for doubtful accounts $10,200 Sales (all on credit) 910,000 a) Prepare the year end adjusting journal entry for bad debt expense assuming that doubtful accounts are estimated to be 3% of gross accounts receivable. b) Prepare the year end adjusting journal entry for estimated bad debt expense assuming that 6% of credit sales are not expected to be collected. c) Compute net realizable value of accounts receivable under the % of receivables approach (after the...
At the end of the current year, Accounts Receivable has a balance of $480,000; Allowance for...
At the end of the current year, Accounts Receivable has a balance of $480,000; Allowance for Doubtful Accounts has a credit balance of $4,500; and sales for the year total $2,160,000. Bad debt expense is estimated at 1/2 of 1% of sales. 1. Determine the amount of the adjusting entry for uncollectible accounts. 2. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. 3. Determine the net realizable value of accounts receivable.
Abbott Company uses the allowance method of accounting for uncollectible accounts. Abbott estimates that 3% of...
Abbott Company uses the allowance method of accounting for uncollectible accounts. Abbott estimates that 3% of credit sales will be uncollectible. On January 1, Allowance for Doubtful Accounts had a credit balance of $3,500. During the year, Abbott wrote off accounts receivable totaling $2,600 and made credit sales of $92,000. There were no sales returns during the year. After the adjusting entry, the December 31 balance in Bad Debt Expense will be a.$3,660 b.$1,750 c.$6,260 d.$2,760
Abbott Company uses the allowance method of accounting for uncollectible accounts. Abbott estimates that 2% of...
Abbott Company uses the allowance method of accounting for uncollectible accounts. Abbott estimates that 2% of credit sales will be uncollectible. On January 1, the Allowance for Doubtful Accounts had a credit balance of $3,800. During the year, Abbott wrote-off accounts receivable totaling $2,000 and made credit sales of $94,000. After the adjusting entry, the December 31 balance in Bad Debt Expense would be Select the correct answer. $1,880 $3,680 $5,680 $3,800
Your company has $3,700,000 in credit sales during 2011. The beginning balance of the allowance for...
Your company has $3,700,000 in credit sales during 2011. The beginning balance of the allowance for doubtful accounts is $3,600 and the company writes off $600 in bad debts during the year. (a)Calculate the estimated doubtful accounts using the aging of accounts receivable method given that $1,520,000 of the credit sales are not yet due (estimated that 0.3% are uncollectible), $345,000 are 1-60 days late (estimated that 2.60% are uncollectible) and $10,000 are over 60 days late (estimated that 32%...
cornerstone Exercise 5-25 (Algorithmic) Percentage of Credit Sales Clarissa Company has credit sales of $522,000 during 2019 and estimates at the end of 2019 that 2.5% of these credit sales will eventually default. Also, during 2019 a customer defaults on a $770 balance related to goods purchased in 2018. Prior to the write-off for the $770 default, Clarissa's accounts receivable and allowance for doubtful accounts balances were $402,000 and $129 (credit), respectively, Required: - 1. Prepare the journal entry to...
5. The Lowery Co. uses the direct write-off method of accounting for uncollectible accounts receivable. Lowery has a customer whose accounts receivable balance has been determined to likely be wrotestable The entry to write off this account would be which oflua following?: a. debit Sales Returns and Allowance, credit Accounts Receivable b. debit Bad Debt Expense; credit Allowance for Doubtful Accounts c. debit Allowance for Doubtful Accounts; credit Accounts Receivable. d. debit Bad Debt Expense; credit Accounts Receivable Abbott Company...
Credit Debit $195,800 Accounts Receivable Allowance for Doubtful Accounts Sales Revenue $ 1,480 903,200 (a) Prepare the adjusting entry at December 31, 2022, to record bad debt expense, assuming that the aging schedule indicates that $10,290 of accounts receivable will be uncollectible. (b) Repeat part (a), assuming that instead of a credit balance there is a $1,480 debit balance in Allowance for Doubtful Accounts. (c) During the next month, January 2023, a $2,270 account receivable is written off as uncollectible....
In this module, you will learn how to estimate and report the effects of uncollectible accounts. Under Generally Accepted Accounting Principles, or GAAP companies must use the allowance method to account for uncollectibles. This method involves the following steps: 1. Estimate and record uncollectibles with an end-of-period adjusting journal entry that increases Bad Debt Expense (debit) and increases the Allowance for Doubtful Accounts (credit). 2. Identify and write off specific customer balances in the period that they are determined to...
Aging Method
On January 1, 2019, Smith, Inc., has the following balances for
accounts receivable and allowance for doubtful accounts:
Accounts Receivable
$376,000
Allowance for Doubtful Accounts (a credit balance)
4,200
During 2019, Smith had $2,860,000 of credit sales, collected
$2,905,000 of accounts receivable, and wrote off $3,850 of accounts
receivable as uncollectible. At year end, Smith performs an aging
of its accounts receivable balance and estimates that $3,800 will
be uncollectible.
Cornerstone Exercise 5-28 (Algorithmic) Aging Method On January...
Your company has $3,700,000 in credit sales during 2011. The beginning balance of the allowance for doubtful accounts is $3,600 and the company writes off $600 in bad debts during the year. (a)Calculate the estimated doubtful accounts using the aging of accounts receivable method given that $1,520,000 of the credit sales are not yet due (estimated that 0.3% are uncollectible), $345,000 are 1-60 days late (estimated that 2.60% are uncollectible) and $10,000 are over 60 days late (estimated that 32%...
Most questions answered within 3 hours.
-
The mean waiting time at the drive-through of a fast-food
restaurant from the time an order...
asked 11 minutes ago -
The pitch (p) of a helix is defined as p = dn, in which n is...
asked 13 minutes ago -
Do you agree that the declining stock of social capital is the
blame for the failure...
asked 17 minutes ago -
A researcher is interested in whether coffee consumption helps
with performance on reading comprehension tasks. The...
asked 26 minutes ago -
it has been estimated since the beginning of the human race that
about 133 metric ton...
asked 32 minutes ago -
Where must Medicare prescription drug plans allow for
participants to fill their prescriptions?
asked 35 minutes ago -
Five moles of monatomic ideal gas have initial pressure 2.50 ×
103 Pa and initial volume...
asked 50 minutes ago -
A resistor and the capacitor are used to control the timing in
the RC circuit of...
asked 50 minutes ago -
Living in a group could bring several disadvantages to an
individual. What are some of the...
asked 1 hour ago -
Complete and balance the following reactions. In case of no
reaction occurring write NR.
Mix #1:...
asked 1 hour ago -
If an economy consumes 75% of any increase in income, then an
increase in autonomous investment...
asked 1 hour ago -
A shotputter throws the shot with an initial speed of 15.8 m/s
at a 38.0 ∘...
asked 1 hour ago