FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
At the end of Year 1, Jayrad Company paid $6,000 for insurance coverage for Year 2. It recorded this by debiting Insurance Expense and crediting Cash, but failed to record a year-end adjustment. Upon discovery of this error in Year 2, what correcting journal entry will Jayrad Company make? Ignore income taxes.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by stepSolved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Give me correct answer with explanationarrow_forwardOn December 31, Year 1, the Loudoun Corporation estimated that 3% of its credit sales of $112,500 would be uncollectible. Loudoun uses the allowance method. On February 15, Year 2, one of Loudoun's customers failed to pay his $1,050 account and the account was written off. On April 4, Year 2, this customer paid Loudoun the $1,050. Which of the following correctly states the effect of the adjustment dated December 31, Year 1, on the financial statements of the Loudoun Corporation? A. B. C. D. Assets (3,375) (3,375) 3,375 ΝΑ Multiple Choice Option D Option C Option A Option B Balance Sheet = Liabilities + 3,375 ΝΑ ΝΑ ΝΑ Stockholders' Equity ΝΑ (3,375) 3,375 ΝΑ Revenue ΝΑ ΝΑ ΝΑ ΝΑ Income Statement Expense ΝΑ 3,375 (3,375) ΝΑ = Net Income ΝΑ (3,375) 3,375 ΝΑ Statement of Cash Flows ΝΑ ΝΑ 3,375 0A ΝΑarrow_forwardAllowance for Doubtful Accounts has a debit balance of $766 at the end of the year (before adjustment), and an analysis of accounts in the customers ledger indicates uncollectible receivables of $15,294. Which of the following entries records the proper adjusting entry for bad debt expense? a.debit Bad Debt Expense, $14,528 credit Allowance for Doubtful Accounts, $14,528 b.debit Bad Debt Expense, $766 credit Allowance for Doubtful Accounts, $766 c.debit Allowance for Doubtful Accounts, $15,294 credit Bad Debt Expense, $15,294 d.debit Bad Debt Expense, $16,060 credit Allowance for Doubtful Accounts, $16,060arrow_forward
- Ee.19.arrow_forwardRaintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2023 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $36,000 $ 462,000 During 2024, credit sales were $1,780,000, cash collections from customers $1,860,000, and $41,000 in accounts receivable were written off. In addition, $3,600 was collected from a customer whose account was written off in 2023. An aging of accounts receivable at December 31, 2024, reveals the following: Age Group 0-60 days 61-90 days 91-120 days Percentage of Year- End Receivables in Group Percent Uncollectible 70% 20 5% 15 5 20 5 40 Over 120 days Required: 1. Prepare summary journal entries to account for the 2024 write-offs and the collection of the receivable previously written off. 2. Prepare the year-end adjusting entry for bad debts according to each of the…arrow_forwardPomona inc. uses the aging method in accounting for uncollectible accounts. On March 31, the company wrote off an uncollectible account of $2,600. What effect does the write-off have on the company's financial statements?arrow_forward
- Hi, Please with question, thank you.arrow_forwardIn December of 2019, a company received consulting services of $100,000. No entry was recorded for these service in 2019. The invoice for the services was received in January 2020 and recorded by debiting consulting expense and crediting accounts payable. This error was discovered in 2020 and was determined to be a material error. What is the impact of the error on the net income of 2019 and 2020? Provide the proper correcting journal enntry assuming a 30% tax rate.arrow_forwardFocarrow_forward
- I have entered every answer for Dec 31, and it keeps telling me i am wrong. Can you help me solve?On December 31, 2021, when its Allowance for Doubtful Accounts had a debit balance of $1,315, Wildhorse Co. estimates that 11% of its accounts receivable balance of $107,400 will become uncollectible and records the necessary adjustment to Allowance for Doubtful Accounts. On May 11, 2022, Wildhorse Co. determined that B. Jared’s account was uncollectible and wrote off $1,207. On June 12, 2022, Jared paid the amount previously written off.Prepare the journal entries on December 31, 2021, May 11, 2022, and June 12, 2022. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.) Date Account Titles and Explanation Debit Credit Choose a transaction date December 31, 2021May 11, 2022June 12, 2022 Enter an account title Enter a debit amount Enter a credit…arrow_forwardCraigmont uses the allowance method to account for uncollectible accounts. Its year-end unadjusted trial balance shows Accounts Receivable of $128,500, allowance for doubtful accounts of $905 (credit) and sales of $1,045,000. If uncollectible accounts are estimated to be 0.7% of sales, what is the amount of the bad debts expense adjusting entry?arrow_forwardBlackhorse Productions, Incorporated, used the aging of accounts receivable method to estimate that its Allowance for Doubtful Accounts should be $19,350. The account had an unadjusted credit balance of $10,000 at that time. Required: Prepare journal entries for each of the following. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) a. The appropriate bad debt adjustment was recorded b. Later, an account receivable for $1000 was determined to be uncollectible and was written off. View transaction but Journal entry worksheet Record the end-of-period adjustment for bad debts under the aging of accounts receivable method. Note: Enter dets before creats. Transaction General Journal Debit Credit Cleary Resend untryarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education