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9. During January, the company provided services for $31,000 on credit. b. On January 31, the company estimated bad debts using 2 percent of credit sales. c. On February 4, the company collected $15,500 of accounts receivable. d. On February 15, the company wrote off $150 account receivable. e. During February, the company provided services for $21,000 on credit. f. On February 28, the company estimated bad debts using 2 percent of credit sales. g. On March 1, the company loaned $2,600 to an employee, who signed a 6% note, due in 6 months. . On March 15, the company collected $150 on the account written off one month earlier. i. On March 31, the company accrued interest earned on the note. j. On March 31, the company adjusted for uncollectible accounts, based on the following aging analysis, which includes the preceding transactions (as well as others not listed). Prior to the adjustment, Allowance for Doubtful Accounts has an unadjusted credit balance of $1,110.

9. During January, the company provided services for $31,000 on credit. b. On January 31, the company estimated bad debts using 2 percent of credit sales. c. On February 4, the company collected $15,500 of accounts receivable. d. On February 15, the company wrote off $150 account receivable. e. During February, the company provided services for $21,000 on credit. f. On February 28, the company estimated bad debts using 2 percent of credit sales. g. On March 1, the company loaned $2,600 to an employee, who signed a 6% note, due in 6 months. . On March 15, the company collected $150 on the account written off one month earlier. i. On March 31, the company accrued interest earned on the note. j. On March 31, the company adjusted for uncollectible accounts, based on the following aging analysis, which includes the preceding transactions (as well as others not listed). Prior to the adjustment, Allowance for Doubtful Accounts has an unadjusted credit balance of $1,110.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Web Wizard, Incorporated, has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $31,000 on credit. b. On January 31, the company estimated bad debts using 2 percent of credit sales. c. On February 4, the company collected $15,500 of accounts receivable. d. On February 15, the company wrote off $150 account receivable. e. During February, the company provided services for $21,000 on credit. f. On February 28, the company estimated bad debts using 2 percent of credit sales. g. On March 1, the company loaned $2,600 to an employee, who signed a 6% note, due in 6 months. h. On March 15, the company collected $150 on the account written off one month earlier. i. On March 31, the company accrued interest earned on the note. j. On March 31, the company adjusted for uncollectible accounts, based on the following aging analysis, which includes the preceding transactions (as well as others not listed). Prior to the adjustment, Allowance for Doubtful Accounts has an unadjusted credit balance of $1,110. Number of Days Unpaid Customer Alabama Tourism Bayside Bungalows Others (not shown to save space) Xciting Xcursions Total $ 230 310 15,400 390 0 to 30 $ 110 31 to 60 61 to 90 $ 90 Over 90 5,900 390 7,500 $ 30 1,100 $ 310 900 Total Accounts Receivable $ 16,330 $ 6,400 $ 7,590 $ 1,130 Estimated Uncollectible (%) 3% 10% 20% $ 1,210 30% 3. Show how Accounts Receivable, Notes Receivable, and their related accounts would be reported in the current assets section of a classified balance sheet at the end of the quarter on March 31. (Do not round intermediate calculations.) Current Assets: WEB WIZARD, INCORPORATED Partial Balance Sheet At March 31 Assets Accounts Receivable, Net of Allowance
Transcribed Image Text:Web Wizard, Incorporated, has provided information technology services for several years. For the first two months of the current year, the company has used the percentage of credit sales method to estimate bad debts. At the end of the first quarter, the company switched to the aging of accounts receivable method. The company entered into the following partial list of transactions during the first quarter. a. During January, the company provided services for $31,000 on credit. b. On January 31, the company estimated bad debts using 2 percent of credit sales. c. On February 4, the company collected $15,500 of accounts receivable. d. On February 15, the company wrote off $150 account receivable. e. During February, the company provided services for $21,000 on credit. f. On February 28, the company estimated bad debts using 2 percent of credit sales. g. On March 1, the company loaned $2,600 to an employee, who signed a 6% note, due in 6 months. h. On March 15, the company collected $150 on the account written off one month earlier. i. On March 31, the company accrued interest earned on the note. j. On March 31, the company adjusted for uncollectible accounts, based on the following aging analysis, which includes the preceding transactions (as well as others not listed). Prior to the adjustment, Allowance for Doubtful Accounts has an unadjusted credit balance of $1,110. Number of Days Unpaid Customer Alabama Tourism Bayside Bungalows Others (not shown to save space) Xciting Xcursions Total $ 230 310 15,400 390 0 to 30 $ 110 31 to 60 61 to 90 $ 90 Over 90 5,900 390 7,500 $ 30 1,100 $ 310 900 Total Accounts Receivable $ 16,330 $ 6,400 $ 7,590 $ 1,130 Estimated Uncollectible (%) 3% 10% 20% $ 1,210 30% 3. Show how Accounts Receivable, Notes Receivable, and their related accounts would be reported in the current assets section of a classified balance sheet at the end of the quarter on March 31. (Do not round intermediate calculations.) Current Assets: WEB WIZARD, INCORPORATED Partial Balance Sheet At March 31 Assets Accounts Receivable, Net of Allowance
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