Allowance method entries The following transactions were completed by Wild Trout Gallery during the current fiscal year ended December 31: January 19. April 3. July 16. November 23. December 31. December 31. Reinstated the account of Arlene Gurley, which had been written off in the preceding year as uncollectible. Journalized the receipt of $1,610 cash in full payment of Arlene's account. Wrote off the $9,230 balance owed by Premier GS Co., which is bankrupt. Received 30% of the $16,600 balance owed by Hayden Co., a bankrupt business, and wrote off the remainder as uncollectible. Reinstated the account of Harry Carr, which had been written off two years earlier as uncollectible. Recorded the receipt of $2,625 cash in full payment. Wrote off the following accounts as uncollectible (compound entry): Cavey Co., $6,940; Fogle Co., $2,060; Lake Furniture, $5,295; Melinda Shryer, $1,495. Based on an analysis of the $816,500 of accounts receivable, it was estimated that $35,500 will be uncollectible. Journalized the adjusting entry. Required: 1. Record the January 1 credit balance of $33,800 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 $816,500 balance in acco receivable reflects the adjustments made during the year. Jan. 19 Accounts Receivable-Arlene Gurley Allowance for Doubtful Accounts 1,610 1,610 Jan. 19 Cash 1,610 Accounts Receivable-Arlene Gurley 1,610 Apr. 3 Allowance for Doubtful Accounts 9,230 Accounts Receivable-Premier GS Co. 9,230 July 16 Cash 4,980 Allowance for Doubtful Accounts 11,620 Accounts Receivable-Hayden Co. 16,600 Nov. 23 Accounts Receivable-Harry Carr 2,625 Allowance for Doubtful Accounts 2,625 Nov. 23 Cash 2,625 Accounts Receivable-Harry Carr 2,625 Dec. 31 Allowance for Doubtful Accounts 15,790 Accounts Receivable-Cavey Co. Accounts Receivable-Fogle Co. Accounts Receivable-Lake Furniture 6,940 2,060 5,295 Accounts Receivable-Melinda Shryer 1,495 Dec. 31 Allowance for Doubtful Accounts Accounts Receivable-Cavey Co. Accounts Receivable-Fogle Co. Accounts Receivable-Lake Furniture Accounts Receivable-Melinda Shryer Dec. 31 Bad Debt Expense Allowance for Doubtful Accounts 15,790 6,940 2,060 5,295 1,495 32,405 32,405 2. b. Post each entry that affects the following T accounts and determine the new balances: Allowance for Doubtful Accounts Apr. 3 July 16 9,230 Jan. 1 Balance 11,620 Jan. 19 33,800 1,610 Dec. 31 15,790 Nov. 23 2,625 Dec. 31 Unadjusted Balance 32,405 Dec. 31 Adjusting Entry Dec. 31 Adjusted Balance 1,395 35,500 Bad Debt Expense Dec. 31 Unadjusted Balance 32,405 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 estima expense of 1/2 of 1% of the sales of $5,040,000 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). $

Allowance method entries The following transactions were completed by Wild Trout Gallery during the current fiscal year ended December 31: January 19. April 3. July 16. November 23. December 31. December 31. Reinstated the account of Arlene Gurley, which had been written off in the preceding year as uncollectible. Journalized the receipt of $1,610 cash in full payment of Arlene's account. Wrote off the $9,230 balance owed by Premier GS Co., which is bankrupt. Received 30% of the $16,600 balance owed by Hayden Co., a bankrupt business, and wrote off the remainder as uncollectible. Reinstated the account of Harry Carr, which had been written off two years earlier as uncollectible. Recorded the receipt of $2,625 cash in full payment. Wrote off the following accounts as uncollectible (compound entry): Cavey Co., $6,940; Fogle Co., $2,060; Lake Furniture, $5,295; Melinda Shryer, $1,495. Based on an analysis of the $816,500 of accounts receivable, it was estimated that $35,500 will be uncollectible. Journalized the adjusting entry. Required: 1. Record the January 1 credit balance of $33,800 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 $816,500 balance in acco receivable reflects the adjustments made during the year. Jan. 19 Accounts Receivable-Arlene Gurley Allowance for Doubtful Accounts 1,610 1,610 Jan. 19 Cash 1,610 Accounts Receivable-Arlene Gurley 1,610 Apr. 3 Allowance for Doubtful Accounts 9,230 Accounts Receivable-Premier GS Co. 9,230 July 16 Cash 4,980 Allowance for Doubtful Accounts 11,620 Accounts Receivable-Hayden Co. 16,600 Nov. 23 Accounts Receivable-Harry Carr 2,625 Allowance for Doubtful Accounts 2,625 Nov. 23 Cash 2,625 Accounts Receivable-Harry Carr 2,625 Dec. 31 Allowance for Doubtful Accounts 15,790 Accounts Receivable-Cavey Co. Accounts Receivable-Fogle Co. Accounts Receivable-Lake Furniture 6,940 2,060 5,295 Accounts Receivable-Melinda Shryer 1,495 Dec. 31 Allowance for Doubtful Accounts Accounts Receivable-Cavey Co. Accounts Receivable-Fogle Co. Accounts Receivable-Lake Furniture Accounts Receivable-Melinda Shryer Dec. 31 Bad Debt Expense Allowance for Doubtful Accounts 15,790 6,940 2,060 5,295 1,495 32,405 32,405 2. b. Post each entry that affects the following T accounts and determine the new balances: Allowance for Doubtful Accounts Apr. 3 July 16 9,230 Jan. 1 Balance 11,620 Jan. 19 33,800 1,610 Dec. 31 15,790 Nov. 23 2,625 Dec. 31 Unadjusted Balance 32,405 Dec. 31 Adjusting Entry Dec. 31 Adjusted Balance 1,395 35,500 Bad Debt Expense Dec. 31 Unadjusted Balance 32,405 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 estima expense of 1/2 of 1% of the sales of $5,040,000 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). $

Century 21 Accounting General Journal

11th Edition

ISBN:9781337680059

Author:Gilbertson

Publisher:Gilbertson

Chapter21: Accounting For Accruals, Deferrals, And Reversing Entries

Section21.1: Accruals

Problem 1OYO

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