Please help me to solve this question Bad Debt Expense: Percentage of Credit Sales MethodGilmore Electronics had the following data for a recent year:Cash salesCredit salesAccounts receivable determined to be uncollectibleThe firm's estimated rate for bad debts is 2.2% of credit sales.Required:1. Prepare the journal entry to write off the uncollectible accounts. If an amount box does not require an entry, leave it blank.88(Record write-off of defaulted account)$135,000512,0009,6502. Prepare the journal entry to record the estimate of bad debt expense. If an amount box does not require an entry, leave it blank.Record adjusting entry for bad debt expense estimate3. If Gilmore had written off $3,000 of receivables as uncollectible during the year, how much would bad debt expense reported on the income statement have changed? Enter decrease, if any, as negative amount. If an amount is zero,enter "0".4. Conceptual Connection: If Gilmore's estimate of bad debts is correct (2.2% of credit sales) and the gross margin is 20%, by how much did Gilmore's income from operations increase assuming $150,000 of the sales would have been lostif credit sales were not offered?

Calculation of above requirement are as follows

Answered: Bad Debt Expense: Percentage of Credit…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter5: Sales And Receivables

Section: Chapter Questions

Problem 66E: Bad Debt Expense: Percentage of Credit Sales Method Gilmore Electronics had the following data for a...

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Determining Bad Debt Expense Using the Aging Method At the beginning of the year, Tennyson Auto Parts had an accounts receivable balance of $31,800 and a balance in the allowance for doubtful accounts of $2,980 (credit). During the year, Tennyson had credit sales of $624,300, collected accounts receivable in the amount of $602,700, wrote off $18,600 of accounts receivable, and had the following data for accounts receivable at the end of the period: Required: 1. Determine the desired post adjustment balance in allowance for doubtful accounts. 2. Determine the balance in allowance for doubtful accounts before the bad debt expense adjusting entry is posted. 3. Compute bad debt expense. 4. Prepare the adjusting entry to record bad debt expense.
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Funnel Direct recorded $1,345,780 in credit sales for the year and $695,455 in accounts receivable. The uncollectible percentage is 4.4% for the income statement method and 4% for the balance sheet method. A. Record the year-end adjusting entry for 2018 bad debt using the income statement method. B. Record the year-end adjusting entry for 2018 bad debt using the balance sheet method. C. Assume there was a previous credit balance in Allowance for Doubtful Accounts of $13,888; record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method.
Bad Debt Expense: Percentage of Credit Sales Method Gilmore Electronics had the following data for a recent year: Cash sales $135,000 Credit sales 512,000 Accounts receivable determined to be uncollectible 9,650 The firms estimated rate for bad debts is 2.2% of credit sales. Required: 1. Prepare the journal entry to write off the uncollectible accounts. 2. Prepare the journal entry to record the estimate of bad debt expense. 3. If Gilmore had written off $3,000 of receivables as uncollectible during the year, how much would bad debt expense reported on the income statement have changed? 4. CONCEPTUAL CONNECTION If Gilmores estimate of bad debts is correct (2.2% of credit sales) and the gross margin is 20%, by how much did Gilmores income from operations increase assuming $150,000 of the sales would have been lost if credit sales were not offered?
Earrings Depot records bad debt using the allowance, balance sheet method. They recorded $97,440 in accounts receivable for the year and $288,550 in credit sales. The uncollectible percentage is 5.5%. What is the bad debt estimation for the year using the balance sheet method?
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Doer Company reports year-end credit sales in the amount of $390,000 and accounts receivable of $85,500. Doer uses the income statement method to report bad debt estimation. The estimation percentage is 3.5%. What is the estimated balance uncollectible using the income statement method? A. $13,650 B. $2,992.50 C. $136,500 D. $29,925
Bad Debt Expense: Aging Method Glencoe Supply had the following accounts receivable aging schedule at the end of a recent year. The balance in Glencoes allowance for doubtful accounts at the beginning of the year was $58,620 (credit). During the year, accounts in the total amount of $62,400 were written off. Required: 1. Determine bad debt expense. 2. Prepare the journal entry to record bad debt expense. 3. If Glencoe had written off $90,000 of receivables as uncollectible during the year, how much would bad debt expense reported on the income statement have changed?
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UNCOLLECTIBLE ACCOUNTS-PERCENTAGE OF SALES Nicoles Neckties has total credit sales for the year of 380,000 and estimates that 2% of its credit sales will be uncollectible. Record the end-of-period adjusting entry on December 31, in general journal form, for the estimated bad debt expense. Assume the following independent conditions existed prior to the adjustment: 1. Allowance for Doubtful Accounts has a credit balance of 430. 2. Allowance for Doubtful Accounts has a debit balance of 295.
Jars Plus recorded $861,430 in credit sales for the year and $488,000 in accounts receivable. The uncollectible percentage is 2.3% for the income statement method, and 3.6% for the balance sheet method. A. Record the year-end adjusting entry for 2018 bad debt using the income statement method. B. Record the year-end adjusting entry for 2018 bad debt using the balance sheet method. C. Assume there was a previous debit balance in Allowance for Doubtful Accounts of $10,220, record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method. D. Assume there was a previous credit balance in Allowance for Doubtful Accounts of $5,470, record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method.

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