At December 31, 2020, Net Solutions reported a Cash Sales of $900,000 and Credit Sales of $300,000. Its year-end unadjusted trail balance includes: 1) Allowance for Doubtful Accounts has a $500 debit balance; 2) Accounts Receivable has a $12,000 debit balance. 1) Assuming uncollectibles are estimated to be 1.5% of credit sales, for 2020 calculate the Bad Debt Expense and the balance of Allowance for Doubtful Accounts after adjusting; 2) Prepare the year-end adjusting entry for bad debts of 2020; 3) On Feb. 10, 2021 P. Moore unexpectedly paid his account in full of $490 which was written off in Nov. 2019. Journalize this transaction.
At December 31, 2020, Net Solutions reported a Cash Sales of $900,000 and Credit Sales of $300,000. Its year-end unadjusted trail balance includes: 1) Allowance for Doubtful Accounts has a $500 debit balance; 2) Accounts Receivable has a $12,000 debit balance. 1) Assuming uncollectibles are estimated to be 1.5% of credit sales, for 2020 calculate the Bad Debt Expense and the balance of Allowance for Doubtful Accounts after adjusting; 2) Prepare the year-end adjusting entry for bad debts of 2020; 3) On Feb. 10, 2021 P. Moore unexpectedly paid his account in full of $490 which was written off in Nov. 2019. Journalize this transaction.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:At December 31, 2020, Net Solutions reported a Cash Sales of $900,000 and Credit Sales of $300,000. Its year-end unadjusted trail balance includes: 1) Allowance for
Doubtful Accounts has a $500 debit balance; 2) Accounts Receivable has a $12,000 debit balance.
1) Assuming uncollectibles are estimated to be 1.5% of credit sales, for 2020 calculate the Bad Debt Expense and the balance of Allowance for Doubtful
Accounts after adjusting; 2) Prepare the year-end adjusting entry for bad debts of 2020; 3) On Feb. 10, 2021 P. Moore unexpectedly paid his account in full of
$490 which was written off in Nov. 2019. Journalize this transaction.
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