a. Journalize the write-offs for 2019 under the direct write-off method. b. Journalize the write-offs for 2019 under the allowance method. Also, journalize the adjusting entry for uncollectible accounts. The company recorded $2,600,000 of credit sales during 2019. Based on past history and industry averages, 1.75% of credit sales are expected to be uncollectible. c. How much higher or lower would Adams Company's 2019 net income have been under the direct write-off method than under the allowance method?

a. Journalize the write-offs for 2019 under the direct write-off method. b. Journalize the write-offs for 2019 under the allowance method. Also, journalize the adjusting entry for uncollectible accounts. The company recorded $2,600,000 of credit sales during 2019. Based on past history and industry averages, 1.75% of credit sales are expected to be uncollectible. c. How much higher or lower would Adams Company's 2019 net income have been under the direct write-off method than under the allowance method?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter6: Cash And Receivables

Section: Chapter Questions

Problem 6MC: Prior to adjustments, Barrett Companys account balances at December 31, 2019, for Accounts...

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Prior to adjustments, Barrett Companys account balances at December 31, 2019, for Accounts Receivable and the related Allowance for Doubtful Accounts were 1,200,000 and 60,000, respectively. An aging of accounts receivable indicated that 106,000 of the December 31, 2019, receivables may be uncollectible. The net realizable value of accounts receivable at December 31, 2019, was: a. 1,034,000 b. 1,094,000 c. 1,140,000 d. 1,154,000
Refer to RE6-8. On April 23, 2020, McKinncy Co. receives a check, from Mangold Corporation for 8,500. Prepare the journal entry for McKinncy to record the collection of the account previously written off.
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From the following particulars of Al Zahra LLC for the year 2019, a. Accounts receivable on 1st Jan 2019 RO 20000. b. During the year RO 18000 was collected from the Opening Accounts receivables and the remaining was treated as uncollectable. c. Sales during the year was RO 175000 d. Amount collected from current years sales was RO 150000 e. From the year 2019 Al Zahra LLC started to use Allowance Method for writing off the un collectables. f. Allowance to be created @ 10% on closing receivables
From the following particulars of Al Zahra LLC for the year 2019, a. Accounts receivable on 1st Jan 2019 RO 20000. b. During the year RO 18000 was collected from the Opening Accounts receivables and the remaining was treated as uncollectable. c. Sales during the year was RO 175000 d. Amount collected from current years sales was RO 150000 e. From the year 2019 Al Zahra LLC started to use Allowance Method for writing off the un collectables. f. Allowance to be created @ 10% on closing receivables Prepare a) Account of receivables and b) Allowance for Doubtful debts from the above information
Ace Company uses the Aging of receivables method to account for uncollectible accounts. The company had the following balances on January 01, 2019. Part A Accounts receivable.. .$2,800,000 Allowance for uncollectible accounts... . .$88,800 (credit) The company completed the following transactions during 2019. • April 20- Wrote off the balance of $1,000 from Shari Wickham's account as uncollectible. • November 27 Re-instated the account of Louis Benn and recorded the collection of $1,500 as payment in full for her account which had been written off earlier. • December 31st- i. Recorded the uncollectible account expense based on the aging schedule. The schedule showed that $124,500 of accounts receivable was estimated as uncollectible. ii. Made the closing entry for the uncollectible expense account. Requirements: 1. Prepare journal entries for each transaction (No narrations required) 2. Prepare the Allowance for Uncollectible and the Accounts Receivable accounts based on the…
Ace Company uses the Aging of receivables method to account for uncollectible accounts. Thecompany had the following balances on January 01, 2019.Part AAccounts receivable...........................................$2,800,000Allowance for uncollectible accounts...................$88,800 (credit)The company completed the following transactions during 2019. April 20-- Wrote off the balance of $1,000 from Shari Wickham’s account asuncollectible. November 27- Re-instated the account of Louis Benn and recorded the collection of$1,500 as payment in full for her account which had been written off earlier. December 31sti. Recorded the uncollectible account expense based on the aging schedule. Theschedule showed that $124,500 of accounts receivable was estimated asuncollectible.ii. Made the closing entry for the uncollectible expense account.Requirements:1. Prepare journal entries for each transaction (No narrations required)2. Prepare the Allowance for Uncollectible and the Accounts…
Ace Company uses the Aging of receivables method to account for uncollectible accounts. The company had the following balances on January 01, 2019. Part A Accounts receivable...........................................$2,800,000 Allowance for uncollectible accounts...................$88,800 (credit) The company completed the following transactions during 2019. April 20-- Wrote off the balance of $1,000 from Shari Wickham’s account as uncollectible. November 27- Re-instated the account of Louis Benn and recorded the collection of $1,500 as payment in full for her account which had been written off earlier. December 31st- Recorded the uncollectible account expense based on the aging schedule. The schedule showed that $124,500 of accounts receivable was estimated as uncollectible. Made the closing entry for the uncollectible expense account. Requirements: Prepare journal entries for each transaction (No narrations required) Prepare the Allowance for Uncollectible and the…
Ace Company uses the Aging of receivables method to account for uncollectible accounts. The company had the following balances on January 01, 2019. Part A Accounts receivable...........................................$2,800,000 Allowance for uncollectible accounts...................$88,800 (credit) The company completed the following transactions during 2019. April 20--Wrote off the balance of $1,000 from Shari Wickham’s account as uncollectible. November 27- Re-instated the account of Louis Benn and recorded the collection of $1,500 as payment in full for her account which had been written off earlier. December 31st- i. Recorded the uncollectible account expense based on the aging schedule. The schedule showed that $124,500 of accounts receivable was estimated as uncollectible. ii. Made the closing entry for the uncollectible expense account. Requirements: Prepare journal entries for each transaction (No narrations required) Prepare the Allowance for Uncollectible and…
Ace Company uses the Aging of receivables method to account for uncollectible accounts. The company had the following balances on January 01, 2019. Accounts receivable $2,800,000 Allowance for uncollectible accounts $88,800 (credit) The company completed the following transactions during 2019. Wrote off the balance of $1,000 from Shari Wickham’s account as uncollectible on April 20 Re-instated the account of Louis Benn and recorded the collection of $1,500 as payment in full for her account which had been written off earlier on November 27 On December 31st, Recorded the uncollectible account expense based on the aging schedule. The schedule showed that $124,500 of accounts receivable was estimated as uncollectible and made the closing entry for the uncollectible expense account. Requirements: 1. Prepare journal entries for each transaction (No narrations required) 2. Prepare the Allowance for Uncollectible and the Accounts Receivable accounts based on the information…