Principles of Financial Accounting.
24th Edition
ISBN: 9781260158601
Author: Wild
Publisher: MCG
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Chapter 9, Problem 16QS
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The following transactions were completed by Irvine Company during the current fiscal year ended December 31:
Required: 1. Record the January 1 credit balance of $25,685 in a T-account for Allowance for Doubtful Accounts.
2.A. Journalize the transactions. Refer to the Chart of Accounts for exact wording of account titles.
B. Post each entry that affects the following selected T-accounts and determine the new balances: Allowance for Doubtful Accounts and Bad Debt Expense.
3. Determine the expected net realizable value of the accounts receivable as of December 31 (after all of the adjustments and the adjusting entry).
4. Assuming that instead of basing the provision for uncollectible accounts on an analysis of receivables, the adjusting entry on December 31 had been based on an estimated expense of ¼ of 1% of the net sales of $17,710,000 for the year, determine the following:
A. Bad debt expense for the year.
B. Balance in the allowance account after the adjustment of…
Hunter, inc., analyzed it’s accounts receivable balances at December 31, and arrived at the aged balances listed below, along with the percentage that is estimated to be uncollectible.
The company handles credit losses using the allowance method. The credit balance of the allowance for doubtful accounts is $820 on December 31, before any adjustments.
A. Prepare the adjusting entry for estimated credit losses on December 31.
B. Prepare the journal entry to write off the Rose company’s account on April 10 of the following year in the amount of $650.
Required:1. Prepare journal entries for each transaction.2. Prepare the Allowance for Uncollectible and the Accounts Receivable accounts based on theinformation presented and balance off each account.3. Prepare the balance sheet extract as at Dec 31 to show the net realizable value for theAccounts Receivable.4. Assume that the aging of accounts receivable method was used by the company and that$7,050 of the accounts receivable as of December 31 were estimated to be uncollectible. Youare now required to:a. Determine the amount to be charged to uncollectible expense (show yourworkings for the computation of this figure).b. Prepare the balance sheet extract to show the net realizable value of the AccountsReceivable as at December 31
Chapter 9 Solutions
Principles of Financial Accounting.
Ch. 9 - A companys Accounts Receivable balance at its...Ch. 9 - A companys Accounts Receivable balance at its...Ch. 9 - Total interest to be earned on a 7,500, 5%, 90-day...Ch. 9 - Prob. 4MCQCh. 9 - Prob. 5MCQCh. 9 - Prob. 1DQCh. 9 - Why does the direct write-off method of accounting...Ch. 9 - Prob. 3DQCh. 9 - Prob. 4DQCh. 9 - Prob. 5DQ
Ch. 9 - Why does the Bad Debts Expense account usually not...Ch. 9 - Prob. 7DQCh. 9 - Prob. 8DQCh. 9 - Prob. 9DQCh. 9 - Prob. 10DQCh. 9 - Prob. 1QSCh. 9 - Prob. 2QSCh. 9 - Recovering a bad debt Solstice Company determines...Ch. 9 - Indicate whether each statement best describes the...Ch. 9 - Allowance method for bad debts Gomez Corp. uses...Ch. 9 - On December 31 of Swift Co.s first year, 50,000 of...Ch. 9 - Percent of accounts receivable method Warner...Ch. 9 - Percent of sales method Warner Companys year-end...Ch. 9 - Net Zero Products, a wholesaler of sustainable raw...Ch. 9 - Prob. 10QSCh. 9 - Prob. 11QSCh. 9 - Prob. 12QSCh. 9 - On December 1, Daw Co. accepts a 10,000, 45-day,...Ch. 9 - Prob. 14QSCh. 9 - Prob. 15QSCh. 9 - Prob. 16QSCh. 9 - Prob. 17QSCh. 9 - Prob. 1ECh. 9 - Levine Company uses the perpetual inventory...Ch. 9 - Prob. 3ECh. 9 - Prob. 4ECh. 9 - Prob. 5ECh. 9 - Prob. 6ECh. 9 - Prob. 7ECh. 9 - Prob. 8ECh. 9 - Prob. 9ECh. 9 - Prob. 10ECh. 9 - Prob. 11ECh. 9 - Prob. 12ECh. 9 - Prob. 13ECh. 9 - Prepare journal entries to record transactions for...Ch. 9 - Prob. 15ECh. 9 - On November 30, Petrov Co. has 128,700 of accounts...Ch. 9 - The following information is from the annual...Ch. 9 - Prob. 1APCh. 9 - At December 31, Hawke Company reports the...Ch. 9 - On December 31, Jarden Co.s Allowance for Doubtful...Ch. 9 - Prob. 4APCh. 9 - Prob. 5APCh. 9 - Archer Co. completed the following transactions...Ch. 9 - At December 31, Ingleton Company reports the...Ch. 9 - Prob. 3BPCh. 9 - Prob. 4BPCh. 9 - Prob. 5BPCh. 9 - Prob. 9SPCh. 9 - Prob. 1AACh. 9 - Prob. 2AACh. 9 - Prob. 3AACh. 9 - ETHICS CHALLENGE Anton Blair is the manager of a...Ch. 9 - Prob. 2BTNCh. 9 - Access eBays February 6, 2017, filing of its 10-K...Ch. 9 - Prob. 5BTNCh. 9 - Prob. 6BTN
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- For each of the following scenarios, indicate the amount of the adjusting journal entry for Bad Debt Expense to be recorded, the balance in Allowance for Doubtful Accounts after adjustment at December 31, and the net realizable value of Accounts Receivable at December 31. a. Based on an analysis of Simmons Company's $380,000 balance in Accounts Receivable at December 31, it was estimated that $15,500 will be uncollectible. There is a credit balance of $1,200 in Allowance for Doubtful Accounts before adjustment. Bad Debt Expense $ Allowance for Doubtful Accounts at Dec. 31 Net Realizable Value of Accounts Receivable at Dec. 31 b. Blake Company had credit sales of $900,000 at year-end, an Accounts Receivable balance of $425,000 at December 31, and an Allowance for Doubtful Accounts credit balance of $11,000 before adjustment. Blake estimates bad debt expense as ¾ of 1% of credit sales. Bad Debt Expense $ Allowance for Doubtful Accounts at Dec. 31 Net Realizable…arrow_forwarda)Present the journal entries for the transactions above. (b)Journalise the adjusting entry. Show workings. (c)Determine the net realizable value of the accounts receivable as at 31 Dec. (d)Is the Allowance Method of accounting for doubtful debt better compared to the direct write-off method? Explain.arrow_forwardFor each of the following scenarios, indicate the amount of the adjusting journal entry for Bad Debt expense to be recorded, the balance in Allowance for Doubtful Accounts after adjustment at December 31, and the net realizable value of Accounts Receivable at December 31. a. Based on an analysis of Simmon's Company's $380,000 balance in Accounts Receivable at December 31, it was estimated that $15,500 will be uncollectible. There is a credit balance of $1,200 in Allowance for Doubtful Accounts before adjustment. Bad Debt Expense $fill in the blank 1 Allowance for Doubtful Accounts at Dec. 31 fill in the blank 2 Net Realizable Value of A/R at Dec. 31 fill in the blank 3 b. Blake Company had credit sales of $900,000 at year-end, and has an Accounts Receivable balance of $425,000 at December 31, and an Allowance for Doubtful Accounts credit balance of $11,000 before adjustment. Blake estimates bad debt expense as 3/4 of 1% of credit sales. Bad Debt Expense $fill in the…arrow_forward
- Lemon company uses the balance sheet/aging approach to estimate uncollectible accounts receivable. Based upon recent collection history, Lemon's accountant has prepared an aging of accounts receivable as of December 31, 2019, and has estimated uncollectible accounts receivable of S81,250 as of that date -ie ending balance of Allowance for Doubtful Accounts (ADA). Additional facts needed for questions 1 and 2 below - The balance in the allowance for doubtful accounts (ADA) on January 1, 2019 (beg. balance) was $38,500. · Accounts written off during 2019 amounted to $3,500 Instructions 1. Prepare the entry to record the write off of $3,500 during 2019 2. Prepare the adjusting entry to record the uncollectible accounts expense for 2019 (considering that the ending balance in ADA is $81,250 as mentioned above). 3. Determine the net accounts receivable (net realizable value) that will appear on Lemon's 12/31/19 balance sheet (statement of financial position), if the (gross) accounts…arrow_forwardLemon company uses the balance sheet/aging approach to estimate uncollectible accounts receivable. Based upon recent collection history, Lemon’s accountant has prepared an aging of accounts receivable as of December 31, 2019, and has estimated uncollectible accounts receivable of $81,250 as of that date -ie ending balance of Allowance for Doubtful Accounts (ADA). Additional facts needed for questions 1 and 2 below The balance in the allowance for doubtful accounts (ADA) on January 1, 2019 (beg. balance) was $39,500. Accounts written off during 2019 amounted to $3,500 Instructions Prepare the entry to record the write off of $3,500 during 2019 Prepare the adjusting entry to record the uncollectible accounts expense for 2019 (considering that the ending balance in ADA is $81,250 as mentioned above). Determine the net accounts receivable (net realizable value) that will appear on Lemon’s 12/31/19 balance sheet (statement of financial position), if the (gross) accounts…arrow_forwardUsing data in Exercise 9-9, assume that the allowance for doubtful accounts for Kirchhoff Industries has a credit balance of $10,112 before adjustment on August 31. Journalize the adjusting entry for uncollectible accounts as of August 31.arrow_forward
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