Aging Method On January 1, Hungryman Inc. has the following balances for accounts receivable and allowance for doubtful accounts: Accounts Receivable $183,000 Allowance for Doubtful Accounts (a credit balance) 27,450 During the year, Hungryman had $1,080,000 of credit sales, collected $658,800 of accounts receivable, and wrote off $25,300 of accounts receivable as uncollecti end, Hungryman performs an aging of its accounts receivable balance and estimates that $33,500 will be uncollectible. Required: 1. CalculateHungryman's preadjustment balance in accounts receivable on December 31. 183,000 X 2. Calculate Hungryman's preadjustment balance in allowance for doubtful accounts on December 31. 27,450 X
Aging Method On January 1, Hungryman Inc. has the following balances for accounts receivable and allowance for doubtful accounts: Accounts Receivable $183,000 Allowance for Doubtful Accounts (a credit balance) 27,450 During the year, Hungryman had $1,080,000 of credit sales, collected $658,800 of accounts receivable, and wrote off $25,300 of accounts receivable as uncollecti end, Hungryman performs an aging of its accounts receivable balance and estimates that $33,500 will be uncollectible. Required: 1. CalculateHungryman's preadjustment balance in accounts receivable on December 31. 183,000 X 2. Calculate Hungryman's preadjustment balance in allowance for doubtful accounts on December 31. 27,450 X
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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Transcribed Image Text:Aging Method
On January 1, Hungryman Inc. has the following balances for accounts receivable and allowance for doubtful accounts:
Accounts Receivable
$183,000
Allowance for Doubtful
Accounts (a credit balance)
27,450
During the year, Hungryman had $1,080,000 of credit sales, collected $658,800 of accounts receivable, and wrote off $25,300 of accounts receivable as uncollectible. At year
end, Hungryman performs an aging of its accounts receivable balance and estimates that $33,500 will be uncollectible.
Required:
1. CalculateHungryman's preadjustment balance in accounts receivable on December 31.
183,000 X
2. Calculate Hungryman's preadjustment balance in allowance for doubtful accounts on December 31.
27,450 X
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1. and 2. Using T-accounts, start with the balance at the beginning of the year and make the necessary debits and/or credits for the transactions that occurred during
the year.
3. Prepare the necessary adjusting entry for the year. If an amount box does not require an entry, leave it blank.
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