Question

Presented below are a series of unrelated situations.

Answer the questions relating to each of the five independent situations as requested.

1. BLANK Company’s unadjusted trial balance at December 31, 2017, included the following accounts.

		Debit		Credit
Accounts receivable		$51,200
Allowance for doubtful accounts		$7,880
Net sales				$1,262,100

BLANK Company estimates uncollectible accounts to be 5% of gross accounts receivable. Determine its bad debt expense for 2017.

Bad debt expense for 2017

$

2. An analysis and aging of BLANK Corp. accounts receivable at December 31, 2017, disclosed the following.

Amounts estimated to be uncollectible		$ 184,380
Accounts receivable		1,798,200
Allowance for doubtful accounts (per books)		127,480

What is the net realizable value of BLNAK’s receivables at December 31, 2017?

The net realizable value

$

3. BLANK Co. provides for doubtful accounts based on 3% of gross accounts receivable, The following data are available for 2017.

Credit sales during 2017		$824,300
Bad debt expense		58,070
Allowance for doubtful accounts 1/1/17		18,180
Collection of accounts written off in prior years (customer credit was reestablished)		8,560
Customer accounts written off as uncollectible during 2017		30,830

What is the balance in Allowance for Doubtful Accounts at December 31, 2017?

The balance in Allowance for Doubtful Accounts

$

4. At the end of its first year of operations, December 31, 2017, BLANK Inc. reported the following information.

Accounts receivable, net of allowance for doubtful accounts		$1,007,400
Customer accounts written off as uncollectible during 2017		21,810
Bad debt expense for 2017		85,420

What should be the balance in accounts receivable at December 31, 2017, before subtracting the allowance for doubtful accounts?

Accounts receivable, before deducting allowance for doubtful accounts

$

5. The following accounts were taken from BLANK Inc.’s trial balance at December 31, 2017.

		Debit		Credit
Net credit sales				$690,500
Allowance for doubtful accounts		$14,570
Accounts receivable		305,800

If doubtful accounts are 3% of accounts receivable, determine the bad debt expense to be reported for 2017.

The bad debt expense, as adjusted

$

Answer 1

o un collectible amount = 5% of Accounts receivable = $51,200 x 0.05 -> $2560 Since, allowance for doubtful Account has a debit balance, you add them = $ 7,880 + $2560 = $ 10,440 Net reali zabile value = Accounts receivable - Account uncollectable (ignore allowance for - $ 1,798,200 - $184,380 doubful account ) = $1,613,820 @ Balance in Allowance for Doutatful acount = Bad debut expense + Beggining Balance + collection of accounts written off in prior years - current accounts written off during the year $58,070 + 18,180 + 8560 - 30,830 = $53,980) Accounts receivable, before de dueting allowance for doubful accounts - Accounts receivable +(Bad debat expense – Accounts written off) = $1,007,400 + ($85,420 - $21,810) = $1,007,400 + $ 63,610 = $ 1,071,010 Bad debt expense Account receivable X 0.03 = $305,800 X 0.03 = $9174 Allowance for doubtful allants has a debut Since balance, add them: - = $14,570 + $9174 - $23,744