Martin Incorporated uses the percent-of-credit sales method to estimate uncollectibles. Total sales for the current year amount to $6,000,000 (2,800,000 were cash sales), and management estimates 5% of credit sales will be uncollectible. Allowance for Uncollectible Accounts prior to adjustment has a credit balance of $3,400. What is the balance in Allowance for Uncollectible Accounts after the adjustment for uncollectible account expense? O $235,700. $152,000. $163,400 O $147,700. None of the above.

Martin Incorporated uses the percent-of-credit sales method to estimate uncollectibles. Total sales for the current year amount to $6,000,000 (2,800,000 were cash sales), and management estimates 5% of credit sales will be uncollectible. Allowance for Uncollectible Accounts prior to adjustment has a credit balance of $3,400. What is the balance in Allowance for Uncollectible Accounts after the adjustment for uncollectible account expense? O $235,700. $152,000. $163,400 O $147,700. None of the above.

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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8. Alladin Corporation uses the allowance method in estimating uncollectibles. At the end of the year, Alladin Corporation estimates that 2% of its credit sales of $1,000,000 will be uncollectible. Allowance for Doubtful Accounts has a credit balance of $1,000 before adjustment. What is the amount of the adjusting entry? a. $20,000 b. $21,000 c. $22,000 d. $19,000
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For several years, Xtreme Co's sales have been on a "cash only" basis. On January 1, 20Y4, however, Xtreme Co. began offering credit on terms of n/30. The amount of the adjusting entry to record the estimated uncollectible receivables at the end of each year has been ½ of 1% of credit sales, which is the rate reported as the average for the industry. Credit sales and the year-end credit balances in Allowance for Doubtful Accounts for the past four years are as follows: Allowance for Doubtful Accounts Credit Sales Year $ 5,000 $4,000,000 20Y4 4,400,000 20Y5 8,250 4,800,000 10,200 20Υ6 20Y7 5,100,000 14,400 (Continued)
At the end of the current year, the accounts receivable account has a balance of $2,875,000 and sales for the year total $34,500,000. Determine the amount of the adjustment to provide for doubtful accounts under each of the following independent assumptions: a. The allowance account before adjustment has a negative balance of $(18,500). Bad debt expense is estimated at ½ of 1% of sales. The allowance account before adjustment has a negative balance of $(18,500). An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $200,000.$fill in the blank 2 c. The allowance account before adjustment has a positive balance of $9,000. Bad debt expense is estimated at ¾ of 1% of sales.$fill in the blank 3 d. The allowance account before adjustment has a positive balance of $9,000. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $255,000.
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At the end of October, Santa Fe Company’s management estimates the uncollectible accounts expense to be 1 percent of net sales of $1,385,000. Prepare the journal entry to record the uncollectible accounts expense, assuming the Allowance for Uncollectible Accounts has a debit balance of $7,000.
Cortez Corporation uses the percentage of sales method to estimate its uncollectible accounts. Cortez has an ending balance of accounts receivable of $10,000. The allowance for doubtful accounts showed a balance of $1,000 in the beginning of the period. During the year, a total of $300 in accounts was written off as uncollectible. The company made credit sales of $100,000 in the current period. It estimates that 5% of sales will prove to be uncollectible. What is the ending balance of allowance for doubtful accounts of the company for the current period? Please don't provide answer in image format thank you
At the end of the current year, Accounts receivable account has a debit balance of $2,700,000 and sales for the year total $32,400,000. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the following assumptions: The allowance account before adjustment has a debit balance of $27,100. Bad debt expense is estimated at ½ of 1% of sales The allowance account before adjustment has a debit balance of $27,100. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $128,000. The allowance account before adjustment has a credit balance of $17,900. Bad debt expense is estimated at ¾ of 1% of sales. The allowance account before adjustment has a credit balance of $17,900. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $279,000.
At December 31, Gill Co. reported accounts receivable of $294,000 and an allowance for uncollectible accounts of $1,050 (credit) before any adjustments. An analysis of accounts receivable suggests that the allowance for uncollectible accounts should be 4% of accounts receivable. The amount of the adjustment for uncollectible accounts would be: Multiple Choice $11,760. $10,710. $9,220. $1,050.
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