Entries for Bad Debt Expense Under the Direct Write-Off and Allowance Method The following selected transactions were taken from the records of Rustic Tables Company for the year ending December 31:June 8.Wrote off account of Kathy Quantel, $7,910.Aug. 14.Received $5,620 as partial payment on the $14,160 account of Rosalie Oakes. Wrote off the remaining balance as uncollectible.Oct. 16.Received the $7,910 from Kathy Quantel, whose account had been written off on June 8. Reinstated the account and recorded the cash receipt.Dec. 31.Wrote off the following accounts as uncollectible (record as one journal entry): Wade Dolan$2,290Greg Gagne1,420Amber Kisko5,460Shannon Poole3,160Niki Spence870Dec. 31.If necessary, record the year-end adjusting entry for uncollectible accounts.If no entry is required, select "No entry" and leave the amount boxes blank. If an amount box does not require an entry, leave it blank.a. Journalize the transactions under the direct write-off method.June 8 Bad Debt ExpenseBad Debt Expense Accounts Receivable-Kathy QuantelAccounts Receivable-Kathy QuantelAug. 14 CashCash Bad Debt ExpenseBad Debt Expense Accounts Receivable-Rosalie OakesAccounts Receivable-Rosalie OakesOct. 16 Accounts Receivable-Kathy QuantelAccounts Receivable-Kathy Quantel Bad Debt ExpenseBad Debt ExpenseOct. 16 CashCash Accounts Receivable-Kathy QuantelAccounts Receivable-Kathy QuantelDec. 31 Bad Debt ExpenseBad Debt Expense Accounts Receivable-Wade DolanAccounts Receivable-Wade Dolan Accounts Receivable-Greg GagneAccounts Receivable-Greg Gagne Accounts Receivable-Amber KiskoAccounts Receivable-Amber Kisko Accounts Receivable-Shannon PooleAccounts Receivable-Shannon Poole Accounts Receivable-Niki SpenceAccounts Receivable-Niki SpenceDec. 31 No entryNo entry - Select -- Select - Question Content Areab. Journalize the transactions under the allowance method, assuming that the allowance account had a beginning balance of $23,730 at the beginning of the year and the company uses the analysis of receivables method. Rustic Tables Company prepared the following aging schedule for its accounts receivable:Aging Class (Numberof Days Past Due)Receivables Balanceon December 31Estimated Percent ofUncollectible Accounts 0-30 days$380,000 1% 31-60 days142,000 8 61-90 days45,000 30 91-120 days17,000 45 More than 120 days23,000 80 Total receivables$607,000 June 8 Allowance for Doubtful AccountsAllowance for Doubtful Accounts Accounts Receivable-Kathy QuantelAccounts Receivable-Kathy QuantelAug. 14 CashCash Allowance for Doubtful AccountsAllowance for Doubtful Accounts Accounts Receivable-Rosalie OakesAccounts Receivable-Rosalie OakesOct. 16 Accounts Receivable-Kathy QuantelAccounts Receivable-Kathy Quantel Allowance for Doubtful AccountsAllowance for Doubtful AccountsOct. 16 CashCash Accounts Receivable-Kathy QuantelAccounts Receivable-Kathy QuantelDec. 31 Allowance for Doubtful AccountsAllowance for Doubtful Accounts Accounts Receivable-Wade DolanAccounts Receivable-Wade Dolan Accounts Receivable-Greg GagneAccounts Receivable-Greg Gagne Accounts Receivable-Amber KiskoAccounts Receivable-Amber Kisko Accounts Receivable-Shannon PooleAccounts Receivable-Shannon Poole Accounts Receivable-Niki SpenceAccounts Receivable-Niki SpenceDec. 31 Bad Debt ExpenseBad Debt Expense Allowance for Doubtful AccountsAllowance for Doubtful Accounts Question Content Areac. How much higher (lower) would Rustic Tables’ net income have been under the direct write-off method than under the allowance method? by fill in the blank 9c8fac094f8bf80_2

The financial accounting term allowance method refers to the process of an uncollectible account…

Entries for Bad Debt Expense Under the Direct Write-Off and Allowance Method The following selected transactions were taken from the records of Rustic Tables Company for the year ending December 31: June 8. Wrote off account of Kathy Quantel, $7,910. Aug. 14. Received $5,620 as partial payment on the $14,160 account of Rosalie Oakes. Wrote off the remaining balance as uncollectible. Oct. 16. Received the $7,910 from Kathy Quantel, whose account had been written off on June 8. Reinstated the account and recorded the cash receipt. Dec. 31. Wrote off the following accounts as uncollectible (record as one journal entry): Wade Dolan $2,290 Greg Gagne 1,420 Amber Kisko 5,460 Shannon Poole 3,160 Niki Spence 870 Dec. 31. If necessary, record the year-end adjusting entry for uncollectible accounts. If no entry is required, select "No entry" and leave the amount boxes blank. If an amount box does not require an entry, leave it blank. a. Journalize the transactions under the direct write-off method. June 8 Bad Debt Expense Bad Debt Expense Accounts Receivable-Kathy Quantel Accounts Receivable-Kathy Quantel Aug. 14 Cash Cash Bad Debt Expense Bad Debt Expense Accounts Receivable-Rosalie Oakes Accounts Receivable-Rosalie Oakes Oct. 16 Accounts Receivable-Kathy Quantel Accounts Receivable-Kathy Quantel Bad Debt Expense Bad Deb

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

If no entry is required, select "No entry" and leave the amount boxes blank. If an amount box does not require an entry, leave it blank.

a. Journalize the transactions under the direct write-off method.

June 8	Bad Debt Expense	Bad Debt Expense
	Accounts Receivable-Kathy Quantel	Accounts Receivable-Kathy Quantel
Aug. 14	Cash	Cash
	Bad Debt Expense	Bad Debt Expense
	Accounts Receivable-Rosalie Oakes	Accounts Receivable-Rosalie Oakes
Oct. 16	Accounts Receivable-Kathy Quantel	Accounts Receivable-Kathy Quantel
	Bad Debt Expense	Bad Debt Expense
Oct. 16	Cash	Cash
	Accounts Receivable-Kathy Quantel	Accounts Receivable-Kathy Quantel
Dec. 31	Bad Debt Expense	Bad Debt Expense
	Accounts Receivable-Wade Dolan	Accounts Receivable-Wade Dolan
	Accounts Receivable-Greg Gagne	Accounts Receivable-Greg Gagne
	Accounts Receivable-Amber Kisko	Accounts Receivable-Amber Kisko
	Accounts Receivable-Shannon Poole	Accounts Receivable-Shannon Poole
	Accounts Receivable-Niki Spence	Accounts Receivable-Niki Spence
Dec. 31	No entry	No entry
	- Select -	- Select -

Question Content Area

b. Journalize the transactions under the allowance method, assuming that the allowance account had a beginning balance of $23,730 at the beginning of the year and the company uses the analysis of receivables method. Rustic Tables Company prepared the following aging schedule for its accounts receivable:

Aging Class (Number of Days Past Due)	Receivables Balance on December 31	Estimated Percent of Uncollectible Accounts
			0-30 days	$380,000	1	%
			31-60 days	142,000	8
			61-90 days	45,000	30
			91-120 days	17,000	45
			More than 120 days	23,000	80
			Total receivables	$607,000

Question Content Area

c. How much higher (lower) would Rustic Tables’ net income have been under the direct write-off method than under the allowance method?

by fill in the blank 9c8fac094f8bf80_2

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

June 8	Allowance for Doubtful Accounts	Allowance for Doubtful Accounts
	Accounts Receivable-Kathy Quantel	Accounts Receivable-Kathy Quantel
Aug. 14	Cash	Cash
	Allowance for Doubtful Accounts	Allowance for Doubtful Accounts
	Accounts Receivable-Rosalie Oakes	Accounts Receivable-Rosalie Oakes
Oct. 16	Accounts Receivable-Kathy Quantel	Accounts Receivable-Kathy Quantel
	Allowance for Doubtful Accounts	Allowance for Doubtful Accounts
Oct. 16	Cash	Cash
	Accounts Receivable-Kathy Quantel	Accounts Receivable-Kathy Quantel
Dec. 31	Allowance for Doubtful Accounts	Allowance for Doubtful Accounts
	Accounts Receivable-Wade Dolan	Accounts Receivable-Wade Dolan
	Accounts Receivable-Greg Gagne	Accounts Receivable-Greg Gagne
	Accounts Receivable-Amber Kisko	Accounts Receivable-Amber Kisko
	Accounts Receivable-Shannon Poole	Accounts Receivable-Shannon Poole
	Accounts Receivable-Niki Spence	Accounts Receivable-Niki Spence
Dec. 31	Bad Debt Expense	Bad Debt Expense
	Allowance for Doubtful Accounts	Allowance for Doubtful Accounts