Accounting for uncollectible accounts: allowance method lo 7-1
[the following information applies to the questions displayed below.]
holmes cleaning service began operation on january 1, year 1. the company experienced the following events for its first year of operations:
events affecting year 1:
provided $210,000 of cleaning services on account.
collected $157,500 cash from accounts receivable.
paid salaries of $38,000 for the year.
adjusted the accounts to reflect management’s expectations that uncollectible accounts expense would be $1,300. the expense was determined using the percent of revenue method.
exercise 7-2a part c
c. prepare an income statement, balance sheet, and statement of cash flows for year 1. (statement of cash

The following selected circumstances relate to pending lawsuits for erismus, inc. erismus’s fiscal year ends on december 31. financial statements are issued in march 2019. erismus prepares its financial statements according to u. s. gaap. required: indicate the amount erismus would record as an asset, liability, or not accrued in the following circumstances. 1. erismus is defending against a lawsuit. erismus's management believes the company has a slightly worse than 50/50 chance of eventually prevailing in court, and that if it loses, the judgment will be $1,000,000. 2. erismus is defending against a lawsuit. erismus's management believes it is probable that the company will lose in court. if it loses, management believes that damages could fall anywhere in the range of $2,000,000 to $4,000,000, with any damage in that range equally likely. 3. erismus is defending against a lawsuit. erismus's management believes it is probable that the company will lose in court. if it loses, management believes that damages will eventually be $5,000,000, with a present value of $3,500,000. 4. erismus is a plaintiff in a lawsuit. erismus's management believes it is probable that the company eventually will prevail in court, and that if it prevails, the judgment will be $1,000,000. 5. erismus is a plaintiff in a lawsuit. erismus’s management believes it is virtually certain that the company eventually will prevail in court, and that if it prevails, the judgment will be $500,000.