Bad debts : It refers to the amount that was expected to be received on credit sales but went uncollectible. It is a loss to the company. Allowance for doubtful accounts: It refers to the amount that is use to keep aside by the company as a provision for the part of accounts receivable that may go uncollectible. To explain: The reason of written off a bad debt against the allowance for doubtful accounts not reducing the estimated realizable value of a company’s accounts receivable. Explanation: The writing off a bad debt against the allowance for doubtful accounts does not reduce the estimated realizable value of a company’s accounts receivable. The reason behind it, is that writing off bad debts against allowance for doubtful accounts would have the effect on accounts receivable and allowance for doubtful accounts both with the same amount by leaving the actual difference same between them. The writing off a bad debt against allowance for doubtful accounts includes the journal entry of debiting allowance for doubtful accounts by crediting accounts receivable with the same amount for both the accounts. So, the actual difference between the amount of the two remains the same and that results in neither decrease nor increase in the estimated realizable value of a company’s accounts receivable

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Kindly give a step by step details explaination of each answers especially question 5 and 6. Please, don't just give answers without explaining how we arrived at the answer. Thanks! The following are the questions: 1. What is the general journal entries the transactions described for Hogan Company. All sales are on account. Use the date of December 31 to make the entry to summarize sales for the year in the old territory and new territory. 2. Make the journal entries to record the write-off of accounts in the new territory. 3. Make the journal entry to record the write-off of accounts in the old territory. 4. Make the entry on December 31 to record uncollectible accounts expense for 20X1 for both territories. Make the calculation using the percentages developed by Hogan. 5. Let’s say the Allowance for Doubtful Accounts had a credit balance of $24,800 on September 30 before any of the above entries were made. Calculate the balance in the allowance account after…

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Chapter 7, Problem 5DQ

To determine

Bad debts: It refers to the amount that was expected to be received on credit sales but went uncollectible. It is a loss to the company.

Allowance for doubtful accounts: It refers to the amount that is use to keep aside by the company as a provision for the part of accounts receivable that may go uncollectible.

To explain: The reason of written off a bad debt against the allowance for doubtful accounts not reducing the estimated realizable value of a company’s accounts receivable.

Explanation:

The writing off a bad debt against the allowance for doubtful accounts does not reduce the estimated realizable value of a company’s accounts receivable.

The reason behind it, is that writing off bad debts against allowance for doubtful accounts would have the effect on accounts receivable and allowance for doubtful accounts both with the same amount by leaving the actual difference same between them.

The writing off a bad debt against allowance for doubtful accounts includes the journal entry of debiting allowance for doubtful accounts by crediting accounts receivable with the same amount for both the accounts.

So, the actual difference between the amount of the two remains the same and that results in neither decrease nor increase in the estimated realizable value of a company’s accounts receivable

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Kindly give a step by step details explaination of each answers especially question 5 and 6. Please, don't just give answers without explaining how we arrived at the answer. Thanks! The following are the questions: 1. What is the general journal entries the transactions described for Hogan Company. All sales are on account. Use the date of December 31 to make the entry to summarize sales for the year in the old territory and new territory. 2. Make the journal entries to record the write-off of accounts in the new territory. 3. Make the journal entry to record the write-off of accounts in the old territory. 4. Make the entry on December 31 to record uncollectible accounts expense for 20X1 for both territories. Make the calculation using the percentages developed by Hogan. 5. Let’s say the Allowance for Doubtful Accounts had a credit balance of $24,800 on September 30 before any of the above entries were made. Calculate the balance in the allowance account after…

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