Entries Related to Uncollectible Accounts The following transactions were completed by The Wild Trout Gallery during the current fiscal year ended December 31: Jan. Apr. July 19 Reinstated the account of Arlene Gurley, which had been written off in the preceding year as uncollectible. Journalized the receipt of $2,180 cash in full payment of Arlene's account. 3 Wrote off the $12,490 balance owed by Premier GS Co., which is bankrupt. 16 Received 45% of the $22,400 balance owed by Hayden Co., a bankrupt business, and wrote off the remainder as uncollectible. Nov. 23 Reinstated the account of Harry Carr, which had been written off two years earlier as uncollectible. Recorded the receipt of $3,555 cash in full payment. Dec. 31 Wrote off the following accounts as uncollectible (one entry): Cavey Co., $9,395; Fogle Co., $2,790; Lake Furniture, $7,170; Melinda Shryer, $2,025. 31 Based on an analysis of the $1,106,300 of accounts receivable, it was estimated that $48,100 will be uncollectible. Journalized the adjusting entry. Required: 1. Record the January 1 credit balance of $45,800 in a T account presented below in requirement 2b for Allowance for Doubtful Accounts. 2. a. Journalize the transactions. If an amount box does not require an entry, leave it blank. Note: For the December 31 adjusting entry, assume the $1,106,300 balance in accounts receivable reflects the adjustments made during the year. 2. b. Post each entry that affects the following T accounts and determine the new balances: Apr. 3 July 16 Dec. 31 Allowance for Doubtful Accounts Jan. 1 Balance Jan. 19 Nov. 23 Dec. 31 Unadjusted Balance Dec. 31 Adjusting Entry Dec. 31 Adjusted Balance Bad Debt Expense Dec. 31 Adjusting Entry 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 ½ of 1% of the sales of $6,830,000 for the year, determine the following: a. Bad debt expense for the year. $ b. Balance in the allowance account after the adjustment of December 31. $ c. Expected net realizable value of the accounts receivable as of December 31 (after all of the adjustments and the adjusting entry).

Entries Related to Uncollectible Accounts The following transactions were completed by The Wild Trout Gallery during the current fiscal year ended December 31: Jan. Apr. July 19 Reinstated the account of Arlene Gurley, which had been written off in the preceding year as uncollectible. Journalized the receipt of $2,180 cash in full payment of Arlene's account. 3 Wrote off the $12,490 balance owed by Premier GS Co., which is bankrupt. 16 Received 45% of the $22,400 balance owed by Hayden Co., a bankrupt business, and wrote off the remainder as uncollectible. Nov. 23 Reinstated the account of Harry Carr, which had been written off two years earlier as uncollectible. Recorded the receipt of $3,555 cash in full payment. Dec. 31 Wrote off the following accounts as uncollectible (one entry): Cavey Co., $9,395; Fogle Co., $2,790; Lake Furniture, $7,170; Melinda Shryer, $2,025. 31 Based on an analysis of the $1,106,300 of accounts receivable, it was estimated that $48,100 will be uncollectible. Journalized the adjusting entry. Required: 1. Record the January 1 credit balance of $45,800 in a T account presented below in requirement 2b for Allowance for Doubtful Accounts. 2. a. Journalize the transactions. If an amount box does not require an entry, leave it blank. Note: For the December 31 adjusting entry, assume the $1,106,300 balance in accounts receivable reflects the adjustments made during the year. 2. b. Post each entry that affects the following T accounts and determine the new balances: Apr. 3 July 16 Dec. 31 Allowance for Doubtful Accounts Jan. 1 Balance Jan. 19 Nov. 23 Dec. 31 Unadjusted Balance Dec. 31 Adjusting Entry Dec. 31 Adjusted Balance Bad Debt Expense Dec. 31 Adjusting Entry 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 ½ of 1% of the sales of $6,830,000 for the year, determine the following: a. Bad debt expense for the year. $ b. Balance in the allowance account after the adjustment of December 31. $ c. Expected net realizable value of the accounts receivable as of December 31 (after all of the adjustments and the adjusting entry).

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter6: Cash And Receivables

Section: Chapter Questions

Problem 6MC: Prior to adjustments, Barrett Companys account balances at December 31, 2019, for Accounts...

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