Credit Losses Based on Credit Sales Gregg Company uses the allowance method for recording its expected credit losses. It estimates credit losses at three percent of credit sales, which were $900,000 during the year. On December 31, the Accounts Receivable balance was $150,000, and the Allowance for Doubtful Accounts had a credit balance of $12,200 before adjustment. a. Prepare the adjusting entry to record the credit losses for the year. b. Show how Accounts Receivable and the Allowance for Doubtful Accounts would appear in the December 31 balance sheet.

Credit Losses Based on Credit Sales Gregg Company uses the allowance method for recording its expected credit losses. It estimates credit losses at three percent of credit sales, which were $900,000 during the year. On December 31, the Accounts Receivable balance was $150,000, and the Allowance for Doubtful Accounts had a credit balance of $12,200 before adjustment. a. Prepare the adjusting entry to record the credit losses for the year. b. Show how Accounts Receivable and the Allowance for Doubtful Accounts would appear in the December 31 balance sheet.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Percent of Sales Method At the end of the current year, Accounts Receivable has a balance of $635,000; Allowance for Doubtful Accounts has a debit balance of $5,500; and sales for the year total $2,860,000. Bad debt expense is estimated at 1.25% of sales. 1. Determine the amount of the adjusting entry for uncollectible accounts. 2. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. Accounts Receivable Allowance for Doubtful Accounts Bad Debt Expense $635,000 ✓ 3. Determine the net realizable value of accounts receivable.
Providing for Doubtful Accounts At the end of the current year, the accounts receivable account has a debit balance of $992,000 and sales for the year total $11,240,000. a. The allowance account before adjustment has a credit balance of $13,400, Bad debt expense is estimated at 1/4 of 1% of sales. b. The allowance account before adjustment has a credit balance of $13,400. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $42,900. c. The allowance account before adjustment has a debit balance of $8,300. Bad debt expense is estimated at 1/2 of 1% of sales. d. The allowance account before adjustment has a debit balance of $8,300. An aging of the account in the customer lodger indicates estimated doubtful accounts of $68,900. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above. b. S C. d.
6 Mario Company's Accounts Receivable balance atDecember 31 was $300,000 and there was a credit balance of $1,400 in the Alowance for Doubtful Accounts, The year's sales were $1,800,000. Mario estimates credit losses for the year at 1.5% of sales. After the appropriate adjusting entry is made for credit losses, what is the net amount of accounts receivable included in the current assets at year- end? A) $300,000 B) $271,600 C) $325,400 D) $277,400
Highland Company uses the allowance method of handling credit losses. It estimates losses at 1% of credit sales, which were $1,200,000 during the year.On December 31, the Accounts Receivable balance was $280,000, and the Allowance for Doubtful Accounts had a credit balance of $1,700 before adjustment.a. Determine the amount of the adjustment to record credit losses for the year.Note: Use negative signs with answers, when appropriate. Balance Sheet Income Statement Stockholders' Assets = Liabilities + Equity Revenues - Expenses = Net Income b. Show how the Accounts Receivable account and the Allowance for Doubtful Accounts would appear on the December 31 balance sheet.Note: Do not use negative signs with any of your answers. Balance Sheet (excerpt) Current assets Cash $ XX,XXX Inventory XXX,XXX Other current assets X,XXX Total Current Assets…
Percent of Sales Method At the end of the current year, Accounts Receivable has a balance of $4,375,000; Allowance for Doubtful Accounts has a debit balance of $21,300; and sales for the year total $102,480,000. Bad debt expense is estimated at 1/4 of 1% of sales. a. Determine the amount of the adjusting entry for uncollectible accounts. b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. Accounts Receivable $4 Allowance for Doubtful Accounts Bad Debt Expense c. Determine the net realizable value of accounts receivable.
2. D’Costa Company uses the allowance method of handling credit losses. It estimates losses at 2% of credit sales, which were $1,800,000 this year. At December 31 of this year, the Accounts Receivable balance is $270,000, and the Allowance for Doubtful Accounts has a $3,600 credit balance before adjustment. a. Give the adjusting entry to record bad debts expense for this year. b. What net amount of accounts receivable would appear on the December 31 balance sheet this year? c. Assume that D’Costa Company uses aged accounts receivable as a basis of estimating credit losses, instead of a percent of credit sales. If the firm estimates that $22,800 of the accounts will prove uncollectible, what adjusting entry would D’Costa Company make to record the bad debts expense for this year?
Providing for Doubtful Accounts At the end of the current year, the accounts receivable account has a debit balance of $1,132,000 and sales for the year total $12,840,000. The allowance account before adjustment has a credit balance of $15,300. Bad debt expense is estimated at 1/4 of 1% of sales. The allowance account before adjustment has a credit balance of $15,300. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $49,000. The allowance account before adjustment has a debit balance of $9,200. Bad debt expense is estimated at 3/4 of 1% of sales. The allowance account before adjustment has a debit balance of $9,200. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $76,400. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above.
I can not figure out the last part of this question.
Providing for Doubtful Accounts At the end of the current year, the accounts receivable account has a debit balance of $777,000 and sales for the year total $8,810,000. a. The allowance account before adjustment has a credit balance of $10,500. Bad debt expense is estimated at 3/4 of 1% of sales. b. The allowance account before adjustment has a credit balance of $10,500. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $33,600. c. The allowance account before adjustment has a debit balance of $5,700. Bad debt expense is estimated at 1/4 of 1% of sales. d. The allowance account before adjustment has a debit balance of $5,700. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $47,300. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above. a. $ b. $ d. $ %24
Providing for Doubtful Accounts At the end of the current year, the accounts receivable account has a debit balance of $1,162,000 and sales for the year total $13,170,000. The allowance account before adjustment has a credit balance of $15,700. Bad debt expense is estimated at 1/2 of 1% of sales. The allowance account before adjustment has a credit balance of $15,700. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $50,200. The allowance account before adjustment has a debit balance of $9,100. Bad debt expense is estimated at 1/4 of 1% of sales. The allowance account before adjustment has a debit balance of $9,100. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $75,500. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above. a. $ b. $ c. $ d. $