Ivanhoe Company reports the following financial information before adjustments. Dr. Cr. Accounts receivable 60,000 Allowance for doubtful accounts 700 Sales revenue (all on credit) 750,000 Sales returns and allowances 37,000 Prepare the journal entry to record Bad Debt Expense assuming Ivanhoe Company estimates the necessary allowance for doubtful accounts at (a) 2% of accounts receivable. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)
Ivanhoe Company reports the following financial information before adjustments. Dr. Cr. Accounts receivable 60,000 Allowance for doubtful accounts 700 Sales revenue (all on credit) 750,000 Sales returns and allowances 37,000 Prepare the journal entry to record Bad Debt Expense assuming Ivanhoe Company estimates the necessary allowance for doubtful accounts at (a) 2% of accounts receivable. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![## Financial Information Before Adjustments - Ivanhoe Company
### Account Summary
| Account Name | Dr. | Cr. |
|-------------------------------------|-----------|----------|
| Accounts receivable | 60,000 | |
| Allowance for doubtful accounts | | 700 |
| Sales revenue (all on credit) | | 750,000 |
| Sales returns and allowances | 37,000 | |
### Journal Entry Preparation
Prepare the journal entry to record Bad Debt Expense. Ivanhoe Company estimates the necessary allowance for doubtful accounts at:
(a) **2% of Accounts Receivable**
*(Note: Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)*
#### Journal Entry Table
| Account Titles and Explanation | Debit | Credit |
|--------------------------------|-------|--------|
| | | |
| | | |](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F46cced09-a660-424e-b8bf-a08415e6dca0%2F98426f1e-bc09-467c-b7bc-b84b53dfce69%2Fcge4py_processed.png&w=3840&q=75)
Transcribed Image Text:## Financial Information Before Adjustments - Ivanhoe Company
### Account Summary
| Account Name | Dr. | Cr. |
|-------------------------------------|-----------|----------|
| Accounts receivable | 60,000 | |
| Allowance for doubtful accounts | | 700 |
| Sales revenue (all on credit) | | 750,000 |
| Sales returns and allowances | 37,000 | |
### Journal Entry Preparation
Prepare the journal entry to record Bad Debt Expense. Ivanhoe Company estimates the necessary allowance for doubtful accounts at:
(a) **2% of Accounts Receivable**
*(Note: Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)*
#### Journal Entry Table
| Account Titles and Explanation | Debit | Credit |
|--------------------------------|-------|--------|
| | | |
| | | |
![### Accounting for Doubtful Accounts
**Scenario:**
2% of accounts receivable, but the Allowance for Doubtful Accounts had a $4,400 debit balance.
*Note:* Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.
---
#### Journal Entry Table:
| Account Titles and Explanation | Debit | Credit |
|--------------------------------|-------|--------|
| | | |
| | | |
| | | |
**Instructions:** Fill in the appropriate account titles and amounts in the journal entry table as per the scenario analysis.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F46cced09-a660-424e-b8bf-a08415e6dca0%2F98426f1e-bc09-467c-b7bc-b84b53dfce69%2Fw5sbj7_processed.png&w=3840&q=75)
Transcribed Image Text:### Accounting for Doubtful Accounts
**Scenario:**
2% of accounts receivable, but the Allowance for Doubtful Accounts had a $4,400 debit balance.
*Note:* Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.
---
#### Journal Entry Table:
| Account Titles and Explanation | Debit | Credit |
|--------------------------------|-------|--------|
| | | |
| | | |
| | | |
**Instructions:** Fill in the appropriate account titles and amounts in the journal entry table as per the scenario analysis.
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