Assume credit sales for 2019 were $312,000 and that on December 31, 10% of credit sales are estimated to be uncollectible. Using the percentage of sales method: Determine the amount to be charged to the uncollectible expense account. Prepare the Allowance for uncollectible account. Prepare the balance sheet extract to show the net realizable value of the Accounts Receivable as at December 31.
Assume credit sales for 2019 were $312,000 and that on December 31, 10% of credit sales are estimated to be uncollectible. Using the percentage of sales method: Determine the amount to be charged to the uncollectible expense account. Prepare the Allowance for uncollectible account. Prepare the balance sheet extract to show the net realizable value of the Accounts Receivable as at December 31.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
- Assume credit sales for 2019 were $312,000 and that on December 31, 10% of credit sales are estimated to be uncollectible. Using the percentage of sales method:
Determine the amount to be charged to the uncollectible expense account.
Prepare the Allowance for uncollectible account.
Prepare the balance sheet extract to show the net realizable value of the
![Allowance for uncollective Accounts
Date
Particulars
Amount
Date
Particulars
Amount
15 May
Accounts Receivable
2,900
1 Jan
Balance b/d
31,200
4 Aug
Accounts Receivable
3,300
26 Oct
Account Receivable
120
31 Dec
Balance c/d
116,500
31 Dec
Bad Debt
91,380
Balance c/d
116,500
Total
122,700
Total
122,700
Accounts receivable
Date
Particulars
Amount Date
Particulars
Amount
but allowance for
1 Jan
To Balance b/d
312,000 15 May
2,900
uncollectible
by allowance for
10 Jan
to sales Revenue
11,000 4 August
3,300
uncollectible
26 Oct
To Allowance for uncollectible account
120
26 Oct
by cash
120
31 Dec
by balance c/d
316,800
Total
122,700
Total
122,700](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fff783287-5059-4380-acbe-ff6e75a6563a%2F08f9af66-e8ff-4e86-b2d7-637de7dee469%2Fjtr131l_processed.png&w=3840&q=75)
Transcribed Image Text:Allowance for uncollective Accounts
Date
Particulars
Amount
Date
Particulars
Amount
15 May
Accounts Receivable
2,900
1 Jan
Balance b/d
31,200
4 Aug
Accounts Receivable
3,300
26 Oct
Account Receivable
120
31 Dec
Balance c/d
116,500
31 Dec
Bad Debt
91,380
Balance c/d
116,500
Total
122,700
Total
122,700
Accounts receivable
Date
Particulars
Amount Date
Particulars
Amount
but allowance for
1 Jan
To Balance b/d
312,000 15 May
2,900
uncollectible
by allowance for
10 Jan
to sales Revenue
11,000 4 August
3,300
uncollectible
26 Oct
To Allowance for uncollectible account
120
26 Oct
by cash
120
31 Dec
by balance c/d
316,800
Total
122,700
Total
122,700
![Current Assets:
Total Receivable
316,800
Less: Allowance for uncollectible
116,500
Net Trade receivable
200,300](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fff783287-5059-4380-acbe-ff6e75a6563a%2F08f9af66-e8ff-4e86-b2d7-637de7dee469%2Frd4435fj_processed.png&w=3840&q=75)
Transcribed Image Text:Current Assets:
Total Receivable
316,800
Less: Allowance for uncollectible
116,500
Net Trade receivable
200,300
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