COLLEGE ACCOUNTING (LL)W/ACCESS>CUSTOM<
4th Edition
ISBN: 9781260255157
Author: Haddock
Publisher: MCG CUSTOM
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Chapter 6, Problem 1ED
To determine
Discuss the problem associated with Company D’s erroneous invoice.
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On the last day of the fiscal year, a co-worker asks you to cut a check for $2,000 as a miscellaneous expense for supplies in order to complete a project for a VIP customer today. You notice the invoice looks a little different from other invoices that are usually processed. You know that by preparing the closing entries tomorrow, the miscellaneous expense will be set to zero for the beginning of the year.
Minimum of 175 words
Should you write this check today and record the expense or write the check tomorrow?
How would the company be affected if the check is written and the invoice ends up being erroneous?
A large company has hired your friend. She tells you that her boss has asked customers to sign sales agreements just before year end indicating a sale has been made.The boss told customers that he will give them 30 days (well into the next year) to change their minds. If they do not change their minds they will quickly receive the merchandise. If they do change their minds he promised to cancel their orders, take merchandise back, and cancel the invoices.Your friend has been told by her boss to recognize the sales agreements as revenue this year. Your friend has concerns about recognizing revenue before the merchandise is shipped. She likes the company and wants to keep her job.What do you advise her to do?
Provide the following independent journal entries:
a. July 31, 2019. We had $1,000,000 of credit sales in July. We estimate that our bad debt expense will be 1% of credit sales.
b. Aug. 15, 2019. We have an account receivable from Frank Farmworker for $500. On Aug. 15 we decide that we will not collect this account, so need to write it off. On Sept. 5 we get a check from Frank in the mail.
c. Dec. 31, 2019. Allowance for Bad Debts currently has a credit balance of $7,200. We perform an aging of accounts receivable, and determine that the Allowance should have a balance of $10,100.
d. Dec. 31, 2020. We age our accounts receivable:
Age of accounts .
Days: 1-30 31-60 61-9091+Total
Accounts receivable$85,000$40,000$10,000$2,000$137,000
Estimate % uncollectible 1% 5% 20% 60%
What balance should the…
Chapter 6 Solutions
COLLEGE ACCOUNTING (LL)W/ACCESS>CUSTOM<
Ch. 6 - What is the journal entry to close the drawing...Ch. 6 - How is the Income Summary account classified?Ch. 6 - Prob. 1.3SRQCh. 6 - Prob. 1.4SRECh. 6 - Prob. 1.5SRECh. 6 - Prob. 1.6SRACh. 6 - Prob. 2.1SRQCh. 6 - Prob. 2.2SRQCh. 6 - What accounts appear on the post-closing trial...Ch. 6 - Prob. 2.4SRE
Ch. 6 - Prob. 2.5SRECh. 6 - On which financial statement would you find the...Ch. 6 - Prob. 1CSRCh. 6 - A firm has the following expenses: Rent Expense,...Ch. 6 - Prob. 3CSRCh. 6 - What is the last step in the accounting cycle?Ch. 6 - Is the following statement true or false? Why? All...Ch. 6 - Prob. 1DQCh. 6 - Prob. 2DQCh. 6 - What accounts appear on a postclosing trial...Ch. 6 - Prob. 4DQCh. 6 - Prob. 5DQCh. 6 - Prob. 6DQCh. 6 - Prob. 7DQCh. 6 - How is the Income Summary account used in the...Ch. 6 - Briefly describe the flow of data through a simple...Ch. 6 - Prob. 10DQCh. 6 - Prob. 1ECh. 6 - Accounting cycle. Following are the steps in the...Ch. 6 - Prob. 3ECh. 6 - Prob. 4ECh. 6 - Prob. 5ECh. 6 - Prob. 6ECh. 6 - Prob. 7ECh. 6 - Prob. 8ECh. 6 - Prob. 1PACh. 6 - Prob. 2PACh. 6 - Prob. 3PACh. 6 - Prob. 4PACh. 6 - Prob. 1PBCh. 6 - Prob. 2PBCh. 6 - Prob. 3PBCh. 6 - Prob. 4PBCh. 6 - The Trial Balance section of the worksheet for...Ch. 6 - Demetria Davis, the bookkeeper for Home Interiors...Ch. 6 - Prob. 1MFCh. 6 - Prob. 2MFCh. 6 - Why is it important that a firms financial records...Ch. 6 - Prob. 4MFCh. 6 - Prob. 1EDCh. 6 - Prob. 1ICCh. 6 - Prob. 1MPS
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