Instructions(X)Chart of Accounts(X)General Journal3a. Prepare the journal entry on June 30 to record Cowen's estimated uncollectibles, assuming the balance in Allowance for Doubtful AccountsCowen's, a large department store located in a metropolitan area, has beenprior to adjustment is $0.CHART OF ACCOUNTSexperiencing difficulty in estimating its bad debts. The company has decided toprepare an aging schedule for its outstanding accounts receivable and estimate badCowen'sGeneral Journal Instructionsdebts by the due dates of its receivables. This analysis discloses the followingGeneral Ledgerinformation:ASSETSREVENUEPAGE 1Balance Age of Receivable Estimated Percentage Uncollectible111 Cash411 Sales RevenueGENERAL JOURNAL$194,000 Under 30 days0.8%121 AccountsDATEACCOUNT TITLEPOST. REF.DEBITCREDITReceivableEXPENSES119,000 30-60 days2.0%1122 Allowance for500 Cost of Goods73,00061-120 days5.0%2Doubtful AccountsSold41,000121-240 days20.0%141 Inventory511 Insurance25,000241-360 days35.0%152 PrepaidExpense3b. Prepare the journal entry on June 30 to record Cowen's estimated uncollectibles, assuming the balance in Allowance for Doubtful AccountsInsurance512 Utilities Expense19,000Over 360 days60.0%prior to adjustment is a $3,100 debit.181 Equipment521 Salaries$471,000198 AccumulatedExpenseDepreciation532 Bad DebtGeneral Journal InstructionsRequired:Expense1. Use the preceding analysis to compute the estimated amount ofLIABILITIES540 Interest ExpensePAGE 1uncollectible receivables.211 Accounts Payable541 Depreciation2. What is the net realizable value of Cowen's accounts receivable?GENERAL JOURNAL231 Salaries PayableExpense3. Prepare the journal entry to record Cowen's estimated uncollectibles,250 Unearned559 MiscellaneousDATEACCOUNT TITLEPOST. REF.DEBITCREDITassuming the balance in Allowance for Doubtful Accounts prior toRevenueExpensesadjustment is:910 Income Tax261 Income Taxes2A. OPayableExpenseВ. $3,100 (debit)C. $2,500 (credit)Analysis3c. Prepare the journal entry on June 30 to record Cowen's estimated uncollectibles, assuming the balance in Allowance for Doubtful Accountsprior to adjustment is a $2,500 credit.1. Use the Aging analysis to compute the estimated amount of uncollectible receivables.General Journal InstructionsThe estimated amount uncollectible based on the data provided is $PAGE 12. What is the net realizable value of Cowen's accounts receivable?GENERAL JOURNALNet realizable value of accounts receivable $DATEACCOUNT TITLEPOST. REF.DEBITCREDIT

The allowance for doubtful accounts is created to record estimated bad debt expense.

Answered: Instructions X. Cowen's, a large…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Problem 1Q

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Tammany Professional Engineers uses the Percentage of Receivables method to account for bad debt. The following is a summary of Tammany’s Accounts Receivable Aging Report. Cash Sales $42,000 Credit Sales $21,000 Allowance for Uncollectible Accounts December 31, 2020 $4,375 Current > 30 >60 >90 $115,000 $98,000 $75,000 $15,000 Estimated Uncollectible 1% 2% 4% 5% Required: Prepare the total estimate of uncollectible accounts and give the amount of the required adjustment. Do not prepare a journal entry. Please show your work if possible. In addition to submitting your answer here, you should also write it down so you an use it for the next problem.
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Estimating Bad Debts Expense and Reporting Receivables At December 31, Barber Company had a balance of $630,000 in its accounts receivable and an unused balance of $3,900 in its allowance for uncollectible accounts. The company then aged its accounts as follows. Current $519,000 1-60 days past due 72,000 61-180 days past due 25,500 Over 180 days past due 13,500 Total accounts receivable $630,000 The company has experienced losses as follows: 1% of current balances, 5% of balances 1-60 days past due, 15% of balances 61-180 days past due, and 40% of balances over 180 days past due. The company continues to base its allowance for uncollectible accounts on this aging analysis and percentages. a. What amount of bad debts expense does Barber report on its income statement for the year? $ 14,115 b. Show how Barber's December 31 balance sheet will report the accounts receivable and the allowance for uncollectible accounts. Note: Round your answers to the nearest whole dollar. Note: Do not use…
Data for the year ended December 31 are presented below. Sales (100% on credit) $2,100,000 Sales returns 150,000 Accounts Receivable (December 31) 420,000 Allowance for Doubtful Accounts (Before adjustment at December 31) 25,000 Estimated amount of uncollected accounts based on an aging analysis 75,000 If the company uses the aging of accounts receivable method to estimate its bad debts, what will be the net realizable value of its accounts receivable after the adjustment for bad debt expense?
Wohoo Publishers uses the allowance method to estimate uncollectible accounts receivables. The company produced the following aging of the accounts receivable at year-end (Y in thousands). Accounts receivable % uncollectible Estimated bad debts Total 200,000 0-30 days 77,000 2% 31-60 days 46,000 5% 61-90 days 91-120 days 39,000 6% 23,000 10% Over 120 days 15,000 25%
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450 000 Bad Debts A company does not adjust its accounts receivable by estimating bad debts at the end of the fiscal period. It uses a method called direct write-off. With this method accounts receivable are written off when they are determined to be uncollectible For example, on January 31, 20-2, a debt of $1500 was determined to be uncol. lectible because the customer, P. Kully, had declared bankruptcy. The sale of $1500 had been made in the previous fiscal period. This entry was made on January 31, 20-2: Jan. 31 Bad Debts Expense 150000 Accounts Receivable/P. Kully To write off account of bankrupt customer. 150000 Questions 1. How does the fact that an adjustment for estimated bad debts was not made in 20-1 affect the financial statements for that year? 2. How does the write-off entry affect the financial statements of 20-2?
(a) A company has determined that the length of time a receivable is outstanding is the most appropriate credit risk characteristic for determining expected credit losses. The following is an aging schedule for the company's accounts receivable as at December 31, 2023: Customer's name Aber Bohr Chow Datz Others Expected rate of credit loss Expected credit losses Total amount owed $28,000 50,000 42,000 eTextbook and Media 27,000 158,000 $305,000 $41,160 Current (not yet due) Account Titles and Explanation $50,000 15,000 95,000 $160,000 3% $4,800 1-30 12,000 $9,000 $19,000 15,000 $36,000 6% Number of days past due $2,160 31-60 13,000 10% $3,200 61-90 $15,000 15,000 Debit $32,000 $30,000 $47,000 25% Over 90 $7,500 $27,000 20,000 On December 31, 2023, the unadjusted balance in the Allowance for Expected Credit Losses (prior to the aging analysis) was a credit of $20,000. 50% Journalize the adjusting entry to record the expected credit losses on December 31, 2023. (Credit account titles are…
Florence Company had a debit balance of $1,500 in the Allowance for Doubtful Accounts account and a debit balance of $500,000 in the Accounts Receivable account with Credit Sales of $1,500,000 for the year. Management estimates 1.5% of credit sales will become uncollectible. What is the amount of estimated bad debts expense?
Walgreens provided the following information before any year end adjusments: Net credit sales are $120,000 Historical percentage of credit losses is 2% Allowance for doubtful accounts has a credit balance of $300. Accounts receivables ending balance is $47,000. What is the estimated bad debt expense using the percentage of credit sales method? A. $2,400 B. $2,100 C. $940 D. $2,700
During the current year, Giatras Electronics recorded credit sales of $710,000. Based on prior experience, it estimates a 3.0 percent bad debt rate on credit sales Required: 1. Prepare journal entries for each of the following transactions. a. On October 28 of the current year, an account receivable for $2,100 from a prior year was determined to be uncollectible and was written off. b. At year-end, the appropriate bad debt expense adjustment was recorded for the current year. 2. Complete the following table, indicating the amount and effect for each transaction.

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