Business, 26.03.2020 17:41, izabelllreyes
Raintree 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 2020 balance sheet disclosed the following:
Current Assets: Receivables $512,000; net of allowance for uncollectible accounts of $46,000
During 2016, credit sales were $1,830,000, cash collections from customers $1,910,000, and $55,000 in accounts receivable were written off. In addition, $4,600 was collected from a customer whose account was written off in 2015. An aging of accounts receivable at December 31, 2016, reveals the following:
Age Group:
0-60 days, 60% receivables in group, 3% uncollectible
61-90 days, 10% receivables in group, 5% uncollectible
91-120 days, 20% receivables in group, 35% uncollectible
Over 120 days, 10% receivables in group, 45% uncollectible
Prepare the year-end adjusting entry for bad debts according to each of the following situations:
a. Bad debt expense is estimated to be 2% of credit sales for the year.
b. Bad debt expense is estimated by computing net realizable value of the receivables. The allowance for uncollectible accounts is estimated to be 10% of the year-end balance in accounts receivable.
c. Bad debt expense is estimated by computing net realized value of the receivables. The allowance for uncollectible accounts is determined by an aging of accounts receivable.
Answers: 1
Other questions on the subject: Business
Business, 22.06.2019 06:00, Wocking310
Transactions on april 1 of the current year, andrea byrd established a business to manage rental property. she completed the following transactions during april: opened a business bank account with a deposit of $45,000 from personal funds. purchased office supplies on account, $2,000. received cash from fees earned for managing rental property, $8,500. paid rent on office and equipment for the month, $5,000. paid creditors on account, $1,375. billed customers for fees earned for managing rental property, $11,250. paid automobile expenses for month, $840, and miscellaneous expenses, $900. paid office salaries, $3,600. determined that the cost of supplies on hand was $550; therefore, the cost of supplies used was $1,450. withdrew cash for personal use, $2,000. required: 1. indicate the effect of each transaction and the balances after each transaction: for those boxes in which no entry is required, leave the box blank. for those boxes in which you must enter subtractive or negative numbers use a minus sign. (example: -300)
Answers: 1
Business, 22.06.2019 15:00, swansondonovanp66got
Ineed this asap miguel's boss asks him to distribute information to the entire staff about a mandatory meeting. in 1–2 sentences, describe what miguel should do.
Answers: 1
Business, 22.06.2019 20:10, NorbxrtThaG
Assume that a local bank sells two services, checking accounts and atm card services. the bank’s only two customers are mr. donethat and ms. beenthere. mr. donethat is willing to pay $8 a month for the bank to service his checking account and $2 a month for unlimited use of his atm card. ms. beenthere is willing to pay only $5 for a checking account, but is willing to pay $9 for unlimited use of her atm card. assume that the bank can provide each of these services at zero marginal cost. refer to scenario 17-5. if the bank is unable to use tying, what is the profit-maximizing price to charge for a checking account
Answers: 3
Do you know the correct answer?
Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for...
Questions in other subjects:
History, 10.03.2020 23:05
Mathematics, 10.03.2020 23:05
