PROBLEM 9 – 17DOUBTFUL ACCOUNTSThe following are the selected accounts taken from the unadjusted trial balance ofMc Calma:Dr.Cr.Accounts receivableP200,000Allowance for bad debtsSales1,750750,000Sales returns and allowancesSales discounts20,00010,000It was also confirmed that 20% of the total sales was on cash basis.Required:Prepare the adjusting journal entries under the following independent assumptions.Bad debt expense is estimated at 1% of gross sales.Bad debt expense is estimated at 1% of net sales.Bad debt expense is estimated at 1% of credit sales.Allowance for bad debts is estimated at 1% of account receivable balance.а.b.С.d.Allowance for bad debts is to be increased to 1% of account receivable.Allowance for bad debts is to be increased by 1% of account receivableе.f. PROBLEM 9-13RECORDING SEVEN TYPICAL ADJUSTING ENTRIESBalikatan Store is completing the accounting process for the year just ended,December 31, 200B. The transactions in 20OB have been journalized and posted. Thefollowing data with respect to adjusting entries were available:1. Office supplies inventory at January 1, 200B, was P2,500. Office supplies purchasedand debited to office supplies inventory during the year amounted to P6,000. Theyear-end inventory showed P3,000 of supplies on hand.2. Wages earned on December 200B, unpaid and unrecorded on December 31, 200B,amounted to P27,000. The last payroll was December 28; next payroll will beJanuary 6, 200C.3. Three fourths of the basement of the store is rented for P11,000 per month toanother merchant, Kano Enterprises. Kano sells comparable, but not competitive,merchandise. On November 1, 200B, the store collected six months' rent in advancefrom Kano in the amount of P66,000, which was credited in full to rent revenue whencollected.4. The remaining basement space is rented to Gloria Specialty Shop for P5,200 permonth, payable monthly. On December 31, 200B, the rent for November andDecember was not collected or recorded. Collection is expected on January 10,200C.5. Delivery equipment that cost P300,000 was being used by the store. The equipmentwas estimated to have a useful life of four years and a residual value of P6,000 at theend of four years. Assume depreciation for a full year for 200B. The asset will bedepreciated evenly over its useful life.6. On July 1, 200B, a two-year insurance premium amounting to P30,000 was paid incash and debited in full to Prepaid Insurance. Coverage began on July 1, 200B.7. Balikatan operates a repair shop to meet its own needs. Also, the shop does repairfor Kano. At the end of December 31, 200B, Kano had not paid for repairs completedamounting P7,500. This amount has not been recorded as Repairs Shop Revenue.Collection is expected on January 200C.Required:1. Identify each of the above transactions as either creating a deferral account (prepayment or precollection) during the year to be adjusted at the end of the year ocreating an accrual account at the end of the year.2.Give the adjusting entry for each situation that should be recorded for BalikatanStore on December 31, 200B.

“Since you have posted multiple questions, we will solve the first question for you. To get the…

The following are the selected accounts taken from the unadjusted trial balance of Mc Calma: Dr. Cr. Accounts receivable Allowance for bad debts P200,000 1,750 750,000 Sales Sales returns and allowances Sales discounts 20,000 10,000 It was also confirmed that 20% of the total sales was on cash basis. Required: Prepare the adjusting journal entries under the following independent assumptions. Bad debt expense is estimated at 1% of gross sales. a. Bad debt expense is estimated at 1% of net sales. Bad debt expense is estimated at 1% of credit sales. Allowance for bad debts is estimated at 1% of account receivable balance. b. С. d. Allowance for bad debts is to be increased to 1% of account receivable. Allowance for bad debts is to be increased by 1% of account receivable е. f.

The following are the selected accounts taken from the unadjusted trial balance of Mc Calma: Dr. Cr. Accounts receivable Allowance for bad debts P200,000 1,750 750,000 Sales Sales returns and allowances Sales discounts 20,000 10,000 It was also confirmed that 20% of the total sales was on cash basis. Required: Prepare the adjusting journal entries under the following independent assumptions. Bad debt expense is estimated at 1% of gross sales. a. Bad debt expense is estimated at 1% of net sales. Bad debt expense is estimated at 1% of credit sales. Allowance for bad debts is estimated at 1% of account receivable balance. b. С. d. Allowance for bad debts is to be increased to 1% of account receivable. Allowance for bad debts is to be increased by 1% of account receivable е. f.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Assume Simple Company had credit sales of $243,000 and cost of goods sold of $143,000 for the period. Simple uses the percentage of credit sales method and estimates that 2 percent of credit sales would result in uncollectible accounts. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $180. Required: What amount of Bad Debt Expense would the company record as an end-of-period adjustment?
The trial balance before adjustment of Monty Inc. shows the following balances. Accounts Receivable Allowance for Doubtful Accounts Sales Revenue (all on credit) (a) Dr. (b) $106,200 2,065 Cr. Give the entry for estimated bad debts assuming that the allowance is to provide for doubtful accounts on the basis of (a) 4% of gross accounts receivable and (b) 5% of gross accounts receivable and Allowance for Doubtful Accounts has a $1,955 credit balance. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) No. Account Titles and Explanation $802,400 Debit Credit
Please
Determine the amount to be added to Allowance for Doubtful Accounts in each of the following cases and indicate the ending balance in each case. a. Credit balance of $410 in Allowance for Doubtful Accounts just prior to adjustment. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $7,690. Amount added Ending balance b. Credit balance of $410 in Allowance for Doubtful Accounts just prior to adjustment. Bad debt expense is estimated at 1% of credit sales, which totaled $1,032,000 for the year. Amount added Ending balance LA ?
The trial balance before adjustment of Ehrlich Company reports the following balances: Dr. Cr. Accounts receivable $420,000 Allowance for doubtful accounts (debit balance) $ 5,000 Sales (all on credit) 2,000,000 Sales returns and allowances 70,000 Instructions – show all calculations a. Prepare the entry for estimated bad debts assuming that doubtful accounts are estimated to be 5% of gross accounts receivable. b. Prepare the entry for the estimated bad debts assuming that the company estimates bad debts based on the percentage of sales method, using 2% of net sales.
The following account balances are those of Music Land Supply Company as of December 31, the end of the fiscal year, before adjustments. Accounts Receivable $ 43,600 Allowance for Doubtful Accounts 180 cr. Credit Sales 470,000 Required: Prepare the necessary adjusting entry to record Bad Debt Expense in each of the following independent cases. a. Uncollectible accounts are estimated at 1.5% of credit sales. If an amount box does not require an entry, leave it blank. Page: 1 DATE DESCRIPTION POST.REF. DEBIT CREDIT 1 Dec. 31 Bad Debt Expense fill in the blank 56a9ce08f033003_2 fill in the blank 56a9ce08f033003_3 1 2 Allowance for Doubtful Accounts fill in the blank 56a9ce08f033003_5 fill in the blank 56a9ce08f033003_6 2 b. An aging of the accounts receivable indicates that $6,850 will not be collected. If an amount box does not require an entry, leave it blank. Page: 1 DATE DESCRIPTION POST.REF. DEBIT CREDIT…
17.The following information is provided: Unadjusted balance in Allowance for Doubtful Accounts $1,100 (debit)Accounts Receivable, December 31 245,500Sales Returns and Allowances 5,500Sales 850,000Sales Discounts 15,000 Required:1. Prepare the adjusting entry if bad debts are estimated to be 1.5% of net sales.2. Compute the amount of the adjusting entry if bad debts are estimated to be 3% of ending accounts receivable.
Determine the amount to be added to Allowance for Doubtful Accounts in each of the following cases and indicate the ending balance in each case. a. Credit balance of $350 in Allowance for Doubtful Accounts just prior to adjustment. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $7,220. Amount added Ending balance b. Credit balance of $350 in Allowance for Doubtful Accounts just prior to adjustment. Bad debt expense is estimated at 2% of credit sales, which totaled $980,000 for the year. Amount added Ending balance MacBook Pro
Assume that accounts receivable and the allowance for doubtful accounts (AFDA )ending balances were RO400,000 debit and RO5000 credit balances respectively at December 31, and the uncollectible accounts is estimated to be 6% of accounts receivable. The adjusting entry to achieve the correct AFDA adjusted ending balance under percentage of accounts receivables method would be; a. None of the given options b. Dr Bad debt expenses A/C OMR 24000 and Cr Allowance for doubtful accounts A/C OMR 24000 c. Dr Bad debt expenses A/C OMR 19000 and Cr Allowance for doubtful accounts A/C OMR 19000 d. Dr Bad debt expenses A/C OMR 5000 and Cr Allowance for doubtful accounts A/C OMR 5000 Clear my choice
Marigold Company reports the following financial information before adjustments. Accounts Receivable Allowance for Doubtful Accounts Sales Revenue (all on credit) Sales Returns and Allowances (a) Dr. $153,000 No. Account Titles and Explanation (b) 50,540 Cr. Prepare the journal entry to record bad debt expense assuming Marigold Company estimates bad debts at (a) 5% of accounts receivable and (b) 5% of accounts receivable but Allowance for Doubtful Accounts had a $1,540 debit balance. (If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List all debit entries before credit entries.) $3,030 834,500 Debit Credit
Percent of Sales Method At the end of the current year, Accounts Receivable has a balance of $4,375,000; Allowance for Doubtful Accounts has a debit balance of $21,300; and sales for the year total $102,480,000. Bad debt expense is estimated at 1/4 of 1% of sales. a. Determine the amount of the adjusting entry for uncollectible accounts. b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. Accounts Receivable $4 Allowance for Doubtful Accounts Bad Debt Expense c. Determine the net realizable value of accounts receivable.
Allowance for Doubtful Accounts has a credit balance of $613 at the end of the year (before adjustment), and bad debt expense is estimated at 3% of credit sales. If credit sales are $604,400, the amount of the adjusting entry to journalize the estimated uncollectible accounts receivable is a. $18,745 b. $17,519 c. cannot determine without more information d. $18,132