3) At the beginning of 2021, the balance in Jackson Enterprises' Allowance for UncollectibleAccounts was $31,800. During 2021, the company wrote off $38,000 of accounts receivable.Writing off the individual bad debts would include a:A) Debit to Bad Debt Expense.B) Credit to Accounts Receivable.C) Credit to the Allowance for Uncollectible Accounts.D) Debit to Bad Debt Expense; credit to the Allowance for Uncollectible Accounts.4) At December 31, Gill Co. reported accounts receivable of $238,000 and an allowance foruncollectible accounts of $600 (debit) before any adjustments. An analysis of accountsreceivable suggests that the allowance for uncollectible accounts should be 3% of accountsreceivable. The amount of the adjustment for uncollectible accounts would be:A) $6,540.B) $7,800.C) $7,140.D) $7,740.

3) Company wrote off $38,000 of accounts receivable. In balance sheet accounts receivable recorded…

Answered: 3) At the beginning of 2021, the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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At the end of 2023, Ayayai Corp. has accounts receivable of $2.90 million and an allowance for expected credit losses of $115,000. On January 16, 2024, Ayayai determined that its $22,400 receivable from Blossom Company will not be collected, and management has authorized its write-off. On January 31, 2024, Ayayai received notification that the company will receive $0.15 for every $1.00 of accounts receivable relating to Sunland Company The company had previously written off 100% of the amount due from Sunland ($60,500). (a) Your answer is partially correct. Prepare the journal entry for Ayayai to write-off the Blossom receivable and any journal entry needed to reflect the notice regarding Sunland. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) Blossom Company accounts receivable write-off:…
Arlington Cycle Company began operations on January 1, 2020. The company reported the following selected items in its 2021 financial report: 2021 2020 Gross sales $1,400,000 $1,500,000 Accounts receivable 600,000 650,000 Actual bad debt write-offs 22,000 10,000 Arlington estimates bad debts at 2 percent of gross sales. Analyze the activity in the allowance for bad debts T-account, and comment on whether the bad debt estimate has been sufficient to cover the write-offs.
Weldon Corporation's fiscal year ends December 31. The following is a list of transactions involving receivables that occurred during 2021: Mar. 17 Accounts receivable of $3,600 were written off as uncollectible. The company uses the allowance method. 38 Loaned an officer of the company $42,009 and received a note requiring principal and interest at 5% to be paid on March 30, 2022. Hay 30 Discounted the $42,eee note at a local bank. The bank's discount rate is 6%. The note was discounted without recourse and the sale criteria are met. June 30 Sold merchandise to the Blankenship Company for $31,8ea. Terms of the sale are 2/10, n/30. Weldon uses the gross method to account for cash discounts. July 8 The Blankenship Company paid its account in full. Aug. 31 Sold stock in a nonpublic company with a book value of $6,900 and accepted a $7,900 noninterest-bearing note with a discount rate of 6%. The $7,980 payment is due on February 28, 2022. The stock has no ready market value. Dec. 31…
Pincus Associates uses the allowance method to account for bad debts. 2024 was the first year of operations for Pincus, so it had a $0 opening balance in its allowance for uncollectible accounts. During 2024, Pincus provided a total of $267,000 of services on account. In 2024, the company wrote off uncollectible accounts of $10,700. By the end of 2024, cash collections on accounts receivable totaled $224,700. Pincus estimates that 15% of the accounts receivable balance at 12/31/2024 will prove uncollectible. Required: What journal entry did Pincus record to write off uncollectible accounts during 2024? What journal entry should Pincus record to recognize bad debt expense for 2024?
At the beginning of the year, Mitchum Enterprises allows for estimated uncollectible accounts of $21,500. By the end of the year, actual bad debts total $23,500. Determine the financial statement effects of writing off an uncollectible account. (Amounts to be deducted should be entered with minus sign.)
At the end of 2020, Bonita Company has accounts receivable of $960,000 and an allowance for doubtful accounts of $48,000. On January 16, 2021, Bonita Company determined that its receivable from Ramirez Company of $7,200 will not be collected, and management authorized its write-off. What is the net amount expected to be collected of Bonita Company’s accounts receivable after the write-off of the Ramirez receivable? Net amount expected to be collected $
Ervin Company uses the allowance method to account for uncollectible accounts receivable. The allowance account is adjusted based on bad debt expense as a percentage of credit sales. For 2024, net credit sales totaled $5,900,000, and the estimated bad debt percentage is 1.50%. No previously written-off accounts receivable were reinstated during 2024. The allowance for uncollectible accounts had a credit balance of $56,000 at the beginning of 2024 and $47,000, after adjusting entries, at the end of 2024. Required: 1. What is bad debt expense for 2024 as a percent of net credit sales? 2. Assume Ervin makes no other adjustment of bad debt expense during 2024. Determine the amount of accounts receivable written off during 2024. 3. If the company uses the direct write-off method, what would bad debt expense be for 2024?
14. On December 31, 2021, Andy Inc. has a debit balance of $1,500 for the Allowance for Uncollectible Accounts before any year-end adjustment. Andy Inc. also has the following information for its accounts receivable and the estimated percentages of bad debts for different past-due amounts: A. B. C. D. Age Group (days past due) 0-30 31-60 61-90 $6,500. $1,500. $5,000. $8,000. Accounts Receivable $50,000 $20,000 $10,000 Estimated Percent Uncollectible 5% What is the amount of bad debt expense to be reported on Andy Inc.'s financial statements for 2021 using the aging method? 10% 20%
As of January 1, 2024, Barley Company had a credit balance of $520,000 in its allowance for uncollectible accounts. Based on experience, 2% of Barley’s gross accounts receivable have been uncollectible. During 2024, Barley wrote off $650,000 of accounts receivable. Barley’s gross accounts receivable as December 31, 2024 is $18,000,000. How much bad debt expense should Barley record for 2024?
Johnson Company calculates its allowance for uncollectible accounts as 20% of its ending balance in gross accounts receivable. The allowance for uncollectible accounts had a credit balance of $21,000 at the beginning of 2021. No previously written-off accounts receivable were reinstated during 2021. At 12/31/2021, gross accounts receivable totaled $350,200, and prior to recording the adjusting entry to recognize bad debts expense for 2021, the allowance for uncollectible accounts had a debit balance of 38,400 Required: 1. What was the balance in gross accounts receivable as of 12/31/2020? 2. What journal entry should Johnson record to recognize bad debt expense for 2021? 3. Assume Johnson made no other adjustment of the allowance for uncollectible accounts during 2021. Determine the amount of accounts receivable written off during 2021. 4. If Johnson instead used the direct write-off method, what would bad debt expense be for 2021? Required 1 Required 2 Required 3 Required 4 What was…
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 2023 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $50,000 During 2024, credit sales were $1,850,000, cash collections from customers $1,930,000, and $59,000 in accounts receivable were written off. In addition, $5,000 was collected from a customer whose account was written off in 2023. An aging of accounts receivable at December 31, 2024, reveals the following: Age Group 0-60 days 61-90 days 91-120 days Over 120 days Percentage of Year- End Receivables in Group 65% 15 15 5 Percent Uncollectible 4% 10 30 50 $ 532,000 Required: 1. Prepare summary journal entries to account for the 2024 write-offs and the collection of the receivable previously written off. 2. Prepare the year-end adjusting entry for bad debts according to each of the…
Mckinney & Co. estimates its uncollectible accounts as a percentage of credit sales. Mckinney made credit sales of' $1,500,000 in 2019. Mckinney estimates 2.5% of its sales will be uncollectible. Prepare the journal entry to record bad debt expense for McKinney at the end of 2019.

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