Bugler Corp had the following transactions for 2021 related to bad debts. Bugler began 2021 with $20,500 in their Allowance for Doubtful Accounts. a. Record the following transactions in the general journal provided. Feb 4 Wrote off the balance of Cooper Company, $3,500 Jun 12 Wrote off the balance of Jones Corp., $6,500 Aug 9 Recovered $1,200 from Wilson Company whose account was written off in 2020 Aug 10 Deposited the check received from Wilson for the recovered amount written off Nov 21 Wrote off the balance of Atlantic Company, $4,000 Dec 31 Estimated uncollectible accounts as 2% of credit sales. Credit sales were $775,000 b. Calculate the amount in the Allowance for Doubtful Accounts at the end of 2021. Enter the ending balance here c. Assuming Bugler had an Accounts Receivable balance of $780,000, show how Accounts Receivable and the Allowance for Doubtful Accounts would appear on the December 31, 2021 balance sheet Bugler Corp (Enter the Allowance for Doubtful Accounts as negative number)
Bugler Corp had the following transactions for 2021 related to bad debts. Bugler began 2021 with $20,500 in their Allowance for Doubtful Accounts. a. Record the following transactions in the general journal provided. Feb 4 Wrote off the balance of Cooper Company, $3,500 Jun 12 Wrote off the balance of Jones Corp., $6,500 Aug 9 Recovered $1,200 from Wilson Company whose account was written off in 2020 Aug 10 Deposited the check received from Wilson for the recovered amount written off Nov 21 Wrote off the balance of Atlantic Company, $4,000 Dec 31 Estimated uncollectible accounts as 2% of credit sales. Credit sales were $775,000 b. Calculate the amount in the Allowance for Doubtful Accounts at the end of 2021. Enter the ending balance here c. Assuming Bugler had an Accounts Receivable balance of $780,000, show how Accounts Receivable and the Allowance for Doubtful Accounts would appear on the December 31, 2021 balance sheet Bugler Corp (Enter the Allowance for Doubtful Accounts as negative number)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
Bad Debts
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.
Question
| Bugler Corp had the following transactions for 2021 related to |
||||||||
| $20,500 in their Allowance for Doubtful Accounts. | ||||||||
| a. Record the following transactions in the general journal provided. | ||||||||
| Feb | 4 | Wrote off the balance of Cooper Company, $3,500 | ||||||
| Jun | 12 | Wrote off the balance of Jones Corp., $6,500 | ||||||
| Aug | 9 | Recovered $1,200 from Wilson Company whose account was written off in 2020 | ||||||
| Aug | 10 | Deposited the check received from Wilson for the recovered amount written off | ||||||
| Nov | 21 | Wrote off the balance of Atlantic Company, $4,000 | ||||||
| Dec | 31 | Estimated uncollectible accounts as 2% of credit sales. Credit sales were $775,000 | ||||||
| b. Calculate the amount in the Allowance for Doubtful Accounts at the end of 2021. | ||||||||
| Enter the ending balance here | ||||||||
| c. Assuming Bugler had an |
||||||||
| and the Allowance for Doubtful Accounts would appear on the December 31, 2021 |
||||||||
| Bugler Corp (Enter the Allowance for Doubtful Accounts as negative number) | ||||||||
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