Task 1:Ms. Shafiya is accounting manager of Salalah Cement factory, having Ms. Shafiya wishes toexplain about accounts receivable accounting to his accounting executives and expect you tounderstand the following relating to accounts receivable and prepare necessary journal entries andaccounting treatment for the year ended 31* December 2021.• The company sells goods on RO 50000 for cash and RO 30000 on credit basis to variouscustomers in the company. The company has received RO 5000 towards credit sales andthe rest is receivable according to the terms of the business transaction.Later, the company has not received any money out of the rest of the credit sales anddecided to estimate the bad and doubtful debts at 2% of the total credit sales. The companyhad allowance for bad and doubtful debts (credit balance) RO 3000.(a)Explain the concept of bad debts, allowance for doubtful debts and bills receivablePrepare journal entries and show how it will appear in income statement and balance(b)sheet.

A bad debt allowance is a valuation account used to estimate the number of receivables that may…

eceivable accounting to hi relating to accounts receival the year ended 31" Decemb s goods on RO 50000 for ca company. The company ha= ple according to the terms o: ny has not received any m- e the bad and doubtful debts

eceivable accounting to hi relating to accounts receival the year ended 31" Decemb s goods on RO 50000 for ca company. The company ha= ple according to the terms o: ny has not received any m- e the bad and doubtful debts

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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Helix reported the following information in its financial statements. Write-offs of accounts receivable were $340 in the current year. Helix did not recover any write-offs. At December 31 Current Year Prior Year Accounts receivable $ 7,800 $ 5,400 Allowance for doubtful accounts 680 490 Accounts receivable, net $ 7,120 $ 4,910 Determine Bad Debts Expense for the current year.
Blossom Company unadjusted trial balance includes the following balances (assume normal balances): • Accounts Receivable $1130000 • Allowances for Doubtful Accounts $21400 Bad debts are estimated to be 5% of outstanding receivables. What amount of bad debt expense will the company record? $56500 $35100 $33822 $57678
What is the amount of write offs during Year 2 based on the following financial information? Balance Sheet Excerpts As At Year Year 2 Year 1 End(000s) Gross Accts Receivable Allowance for Doubtful Accounts Net Accts Receivable Provision for Bad Debt O $15 $20 $37 $52 $456 $20 $437 $25 $321 $32 $294 $40
Percent of Sales Method At the end of the current year, Accounts Receivable has a balance of $875,000; Allowance for Doubtful Accounts has a debit balance of $8,000; and sales for the year total $3,940,000. Bad debt expense is estimated at 1.25% of sales. a. Determine the amount of the adjusting entry for uncollectible accounts.$ b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. Adjusted BalanceDebit (Credit) Accounts Receivable $ Allowance for Doubtful Accounts $ Bad Debt Expense $ c. Determine the net realizable value of accounts receivable.$
Before adjusting for uncollectible accounts, Minderman Company has accounts receivable of $90,000 and a debit balance of $900 in the Allowance for Doubtful Accounts. The company estimates that 2 percent of one-half of its accounts receivable and 5 percent of the other half of accounts receivable will prove to be uncollectible. Determine the bad debt expense for the current period. A.$2,250 B.$3,150 C.$4,050 D.$2,150
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
Computing Bad Debts Under the Allowance Method Based on Receivables A company has a credit balance of $100 in its allowance for doubtful accounts. The amount of credit sales for the period is $160,000, and the balance in accounts receivable is $200. Assume that the expected credit losses are estimated to be 9% of accounts receivable. a. What is (1) bad debt expense for the year and (2) the ending balance in the allowance for doubtful accounts? 1. Bad debt expense Answer 2. Allowance for doubtful accounts Answer b. How would the answer to part a change (if at all) if the company had a debit balance of $1,200 in its allowance for doubtful accounts before any adjustment? 1. Bad debt expense Answer 2. Allowance for doubtful accounts Answer
Here is information related to Ayayai Company for 2022. Total credit sales $2,571,000 Accounts receivable at December 31 830,000 Uncollectibles written off 32,300 (a) What amount of bad debt expense will Ayayai Company report if it uses the direct write-off method of accounting for uncollectibles?$__________ (b) Assume that Ayayai Company uses the percentage-of-receivables basis to record bad debt expenseand concludes that 6% of accounts receivable will become uncollectible. What amount of bad debt expense will Ayayai record if Allowance for Doubtful Accounts has a credit balance of $4,300?$__________ (c) Assume that Ayayai Company uses the percentage-of-receivables basis to record bad debt expenseand concludes that 6% of accounts receivable will become uncollectible. What amount of bad debt expense will Ayayai record if Allowance for Doubtful Accounts has a debit balance of $4,300?$__________
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! Required information Problem 7-2A (Static) Estimating and reporting bad debts LO P2, P3 [The following information applies to the questions displayed below.] At December 31, Hawke Company reports the following results for its calendar year. Cash sales Credit sales $ 1,905,000 $ 5,682,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable Allowance for doubtful accounts Problem 7-2A (Static) Part 1 $ 1,270,100 debit $ 16,580 debit Required: 1. Prepare the adjusting entry to record bad debts under each separate assumption. a. Bad debts are estimated to be 1.5% of credit sales. b. Bad debts are estimated to be 1% of total sales. c. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible. Adjusting entries (all dated December 31).