QUESTION 3Ava Company sets bad debt expense at 3 percent of its sales. Ava reported total sales of $ 71,572. Before the adjustment, Avahad $655 credit balance in its allowance for doubtful accounts.How much bad debt expense did Ava report on its income statement?QUESTION 4On March 1, 2018, Bodie Co. accepted a $7,500 face value note as evidence of a loan it made to T Company. The note had a 10 percent interest rate and aone-year term. What is the interest revenue recognized by Bodie in 2018QUESTION 5Hope Company's total assets were $5,530. Hope collected on $628 of account receivable that had previously been written off. After the collection,Hope's total assets will be S

3. Bad debts expense = total sales x 3% = $71572*3% = $2147.16

Answered: Ava Company sets bad debt expense at 3…

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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A series of unrelated situations follow for several companies that use ASPE: (a) Larkspur Inc.’s unadjusted trial balance at December 31, 2020, included the following accounts: Debit Credit Allowance for doubtful accounts $8,000 Sales revenue $2,065,000 Sales returns and allowances 61,300 Sales discounts 3,900 Larkspur estimates its bad debt expense to be 1.5% of net sales. Determine its bad debt expense for 2020. (Round answer to 0 decimal places, e.g. 58,971.) Bad debt expense $Enter your answer in accordance to the question statement Save for Later Last saved 23 hours ago. Saved work will be auto-submitted on the due date. Attempts: 0 of 1 used Submit Answer (b) The parts of this question must be completed in order. This part will be available when you complete the part above. (c) The parts of this question must be completed in order. This part will be available when…
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During its first year of operations, Fall Wine Tour earned net credit sales of $311,000. Industry experience suggests that bad debts will amount to 3% of net credit sales. At December 31, 2024, accounts receivable total $44,000. The company uses the allowance method to account for uncollectibles. Read the requirements. Requirement 1. Journalize Fall Wine Tour's Bad Debts Expense using the percent-of-sales method. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Date Accounts and Explanation Debit Credit Dec. 31 Requirement 2. Show how to report accounts receivable on the balance sheet at December 31, 2024. Balance Sheet (Partial): Current Assets:
K Blended Corporation uses the allowance method to account for uncollectible receivables. At the beginning of the year, Allowance for Bad Debts had a credit balance of $1,000. During the year Blended wrote off uncollectible receivables of $2,200. Blended recorded Bad Debts Expense of $3,300. What is Blended's year-end balance in Allowance for Bad Debts? OA. $5,500 OB. $1,100 C. $2,100 OD. $4,300 1
Millennium Associates records bad debt using the allowance, income statement method. They recorded $320,420 in accounts receivable for the year, and $781,270 in credit sales. The uncollectible percentage is 3.6%. On February 5, Millennium Associates identifies one uncollectible account from Molar Corp in the amount of $1,830. On April 15, Molar Corp unexpectedly pays its account in full. Record journal entries for the following. A. Year-end adjusting entry for 2017 bad debt B. February 5, 2018 identification entry C. Entry for payment on April 15, 2018
Concord, Inc. had net sales in 2025 of $1,428,800. At December 31, 2025, before adjusting entries, the balances in selected accounts were Accounts Receivable $392,000 debit, and Allowance for Doubtful Accounts $4,240 credit. If Concord estimates that 9% of its receivables will prove to be uncollectible. Prepare the December 31, 2025, journal entry to record bad debt expense. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually. List debit entry before credit entry.)
Rogan Company's total sales on account for the year amounted to $327,000. The company, which uses the allowance method, estimated bad debts at 1 percent of its credit sales. Required: Journalize the following selected entries: 2017 Dec. 31 Record adjusting entry. 2018 Mar. 2 Write off the account of A.M. Billson as uncollectible, $584. June. 6 Write off the account of W.H. Gilders as uncollectible, $492.
Oriole Company uses the percentage-of-receivables basis to record bad debt expense and concludes that 2% of accounts receivable will become uncollectible. Accounts receivable are $ 620,000 at the end of the year, and the allowance for doubtful accounts has a credit balance of $ 3,320. (a) V Your answer is correct Prepare the adjusting journal entry to record bad debt expense for the year. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Account Titles and Explanation Debit Credit Bad Debt Expense 9080 Allowance for Doubtful Accounts 9080 eTextbook and Media List of Accounts Attempts: 2 of 3 used (b) Your answer is partially correct. If the allowance for doubtful accounts had a debit balance of $ 800 instead of a credit balance of $ 3,320, prepare the adjusting journal entry for bad debt expense. (Credit account titles are automatically…
Required Information [The following information applies to the questions displayed below.] At year-end December 31, Chan Company estimates its bad debts as 0.70% of its annual credit sales of $851,000. Chan records its bad debts expense for that estimate. On the following February 1, Chan decides that the $426 account of P. Park is uncollectible and writes it off as a bad debt. On June 5. Park unexpectedly pays the amount previously written off. Prepare Chan's journal entries to record the transactions of December 31, February 1, and June 5. View transaction list Journal entry worksheet 1 2 3 4 Record the estimated bad debts expense. Note: Enter debits before credits. Date December 31 General Journal Debit Credit Record entry Clear entry View general journal
Gray Corporation controls its cash by depositing receipts on a daily basis and making all disbursements by cheque. After all the posting for the month of August 2020 was completed, the cash balance in the general ledger account at the end of the month was $10,475. The bank statement for the month end received from the First National Bank showed the balance to be $18,000. The following data are available for the purpose of reconciling these balances: a. Cash receipts collected on August 31 amounting to $3,000 have been placed in the night depository and do not appear on the bank statement. b. Bank memos previously not available to the company are included with the bank statement. A memo for an NSF cheque, originally received as payment for an account receivable of $3,000, is included. A memo for bank charges of $75 for the NSF cheque is also included. Another memo advises the company that $2,000 Note Receivable has been collected by the bank, ($1,950 deposit and a bank charge of $50).…
8. JOY Corporation provides an allowance for its doubtful accounts receivable. allowance account had a credit balance of P8,000. Each month JOY accrues bad debts expense in an amount equal to 2% of credit sales. Total credit sales during 2016 amounted to P2,000,000. During 2016 uncollectible accounts receivable totaling P22,000 were written off against the allowance account. An aging of accounts receivable at December 31, 2016 indicates that an allowance of P42,000 should be provided for doubtful accounts as of the date. Accordingly, bad debts expense previously accrued during 2016 should be increased by At December 31, 2015, the
On the year end of July 31, 2020, Rainbow Appliances had the following account balances before adjustments for bad debt was made. Net Credit Sales for the period $1,028,000 CR Accounts Receivable $656,000 DR AFDA $1,900 DR Do not enter dollar signs or commas in the input boxes. a) Use the year-end balances reported on the balance sheet and the aging schedule shown below to calculate the allowance for doubtful accounts. Aging Category Bad Debt % Balance Estimated Bad Debt Less than 30 days 2% $422,000 31-60 days 4% $105,000 61-90 days 11% $75,000 91-120 days 28% $37,000 Over 120 days 52% $17,000 Total $656,000 Prepare the journal entry to record bad debt expense for the year: Date Account Title and Explanation Debit Credit Jul 31 To record bad debt expense b) Assume instead that Rainbow Appliances used the income statement approach for estimating bad debt. If historical data indicates that approximately 2% of net credit sales are uncollectible, what amount is expected to be…

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