Maxwell Inc., analyzed its accounts receivable balances at December 31, and arrived at the aged balances listed below, along with the percentage that is estimated to be uncollectible: % Considered Age Group 0-30 days past due Balance Uncollectible $300,000 19% 31-60 days past due 54,000 3% 61-120 days past due 60,000 6% 121-180 days past due 21,000 10% Over 180 days past due 6,000 20% $441,000 The company handles credit losses using the allowance method. The credit balance of the Allowance for Doubtful Accounts is $2,520 on December 31, before any adjustments. a. Determine the amount of the adjustment for estimated credit losses on December 31. b. Determine the financial statement effect of a write off of Porter Company's account on the following May 12, in the amount of $1,440. Use negative signs with answers, when appropriate. If a transaction increases and decreases the same Balance Sheet category, enter the increase amount in the first row and the decrease amount directly below (in the second row). Balance Sheet Income Statement Stockholders' = Liabilities - Expenses - Net Income Assets + Equity Revenues

Maxwell Inc., analyzed its accounts receivable balances at December 31, and arrived at the aged balances listed below, along with the percentage that is estimated to be uncollectible: % Considered Age Group 0-30 days past due Balance Uncollectible $300,000 19% 31-60 days past due 54,000 3% 61-120 days past due 60,000 6% 121-180 days past due 21,000 10% Over 180 days past due 6,000 20% $441,000 The company handles credit losses using the allowance method. The credit balance of the Allowance for Doubtful Accounts is $2,520 on December 31, before any adjustments. a. Determine the amount of the adjustment for estimated credit losses on December 31. b. Determine the financial statement effect of a write off of Porter Company's account on the following May 12, in the amount of $1,440. Use negative signs with answers, when appropriate. If a transaction increases and decreases the same Balance Sheet category, enter the increase amount in the first row and the decrease amount directly below (in the second row). Balance Sheet Income Statement Stockholders' = Liabilities - Expenses - Net Income Assets + Equity Revenues

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Estimating Uncollectible Accounts and Reporting Accounts Receivable LaFond Company analyzes its accounts receivable at December 31, and arrives at the age categories below along with the percentages that are estimated as uncollectible. Accounts Estimated Receivable Loss % $ 90,000 20,000 11,000 6,000 Over 180 days past due 4,000 Total accounts receivable $ 131,000 Age Group 0-30 days past due 31-60 days past due 61-120 days past due 121-180 296 4 The balance of the allowance for uncollectible accounts is $520 on December 31, before any adjustments. Transaction Record bad debts expense 5 10 25 (a) What amount of bad debts expense will LaFond report in its income statement for the year? $0 Cash Asset (b) Use the financial statement effects template to record LaFond's bad debts expense for the year. Use negative signs with your answers, when appropriate. Noncash Assets Balance Sheet Liabilities Contributed Capital (c) What is the balance of accounts receivable on it December 31 balance…
A year-end review of Accounts Receivable and estimated uncollectible percentages revealed the following: $1300. Days Outstanding 1-30 days 2% 31-60 days 5% 61-90 days 10% Over 90 days 52% Before the year-end adjustment, the credit balance in Allowance for Uncollectible Accounts was $1100. Under the aging-of- receivables method, the Uncollectible-Account Expense at year-end is: $9390. $10,490. Accounts Receivable $8290. Est. Percent Uncollectible $65,000 $45,000 $22,000 $7000
Daley Company prepared the following aging of receivables analysis at December 31. Days Past Due 31 to 60 $ 47,000 Accounts receivable Percent uncollectible Req A Complete this question by entering your answers in the tabs below. Req B and C Not due: 1 to 30: 31 to 60: 61 to 90: Over 90: a. Complete the table below to calculate the estimated balance of Allowance for Doubtful Accounts using aging of accounts receivable. b. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $4,700 credit. Accounts Receivable c. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $1,200 debit. X Total O $625,000 $ 407,000 X X X Complete the table below to calculate the estimated balance of Allowance for Doubtful Accounts using aging of accounts receivable. X Percent Uncollectible (%) = 3%…
Analysis of Receivables Method At the end of the current year, Accounts Receivable has a balance of $670,000; Allowance for Doubtful Accounts has a debit balance of $6,000; and sales for the year total $3,020,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $29,400. 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. Accounts Receivable Allowance for Doubtful Accounts Bad Debt Expense c. Determine the net realizable value of accounts receivable. %24 %24 %24 %24 %24
Estimating Uncollectible Accounts and Reporting Accounts ReceivableCollins Company analyzes its accounts receivable at December 31, and arrives at the aged categories below along with the percentages that are estimated as uncollectible. Age Group Accounts Receivable Estimated Loss % 0-30 days past due $110,000 1% 31-60 days past due 40,000 2 61-120 days past due 27,000 5 121-180 days past due 14,000 10 Over 180 days past due 9,000 25 Total accounts receivable $200,000 The balance of the allowance for uncollectible accounts is $1,100 on December 31, before any adjustments. (a) What amount of bad debts expense will Collins report in its income statement for the year?$Answer? (b) Use the financial statement effects template to record Collin's bad debts expense for the year. Use negative signs with your answers, when appropriate. Balance Sheet Transaction Cash Asset + Noncash Assets = Liabilities + Contributed Capital + Earned Capital…
A year-end review of Accounts Receivable and estimated uncollectible percentages revealed the following: 1-30 days $120,000 1% 31-60 days $80,000 3% 61-90 days $20,000 8% Over 90 days $8,000 40% The Allowance for Uncollectible Accounts had a credit balance before adjustment of $2,000. Under the aging-of-receivables method, the uncollectible-account expense for the year is:
Daley Company prepared the following aging of receivables analysis at December 31. Total Days Past Due 0 1 to 30 31 to 60 61 to 90 Over 90 Accounts receivable $ 575,000 $ 397,000 $ 91,000 $ 37,000 $ 19,000 $ 31,000 Percent uncollectible 2% 3% 6% 8% 11% Complete the table below to calculate the estimated balance of Allowance for Doubtful Accounts using aging of accounts receivable. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $3,700 credit. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $200 debit. Complete the table below to calculate the estimated balance of Allowance for Doubtful Accounts using aging of accounts receivable. Accounts Receivable x Percent Uncollectible (%) = Estimated…
Analysis of Receivables Method At the end of the current year, Accounts Receivable has a balance of $890,000; Allowance for Doubtful Accounts has a credit balance of $8,000; and sales for the year total $4,010,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $36,800. a. Determine the amount of the adjusting entry for uncollectible accounts.$ b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. Accounts Receivable $ Allowance for Doubtful Accounts $ Bad Debt Expense $ c. Determine the net realizable value of accounts receivable.$
The year-end financial statements of Prize Inc. include the accounts receivable footnote:Total accounts and other receivables at December 31 consisted of the following: (in millions) Year 2 Year 1 Total accounts and other receivables $444.4 $476.6 Allowance for doubtful accounts (6.0) (8.4) Total accounts and other receivables, net $438.4 $468.2 The balance sheet reports total assets of $2,984.1 million at December 31, Year 2.The common-size amount for gross accounts and other receivables are: Select one: a. $444.4 million b. None of these are correct. c. 14.7% d. 14.9% e. $438.4 million
Analysis of Receivables Method At the end of the current year, Accounts Receivable has a balance of $545,000; Allowance for Doubtful Accounts has a credit balance of $5,000; and sales for the year total $2,450,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $22,500. a. Determine the amount of the adjusting entry for uncollectible accounts.$ b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. Accounts Receivable $ Allowance for Doubtful Accounts $ Bad Debt Expense $ c. Determine the net realizable value of accounts receivable.$
Analysis of Receivables Method At the end of the current year, Accounts Receivable has a balance of $790,000; Allowance for Doubtful Accounts has a debit balance of $7,000; and sales for the year total $3,560,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $37,800. 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. Accounts Receivable Allowance for Doubtful Accounts Bad Debt Expense c. Determine the net realizable value of accounts receivable.
Reporting Uncollectible Accounts and Accounts Receivable (FSET) LaFond Company analyzes its accounts receivable at December 31 and arrives at the aged categories below along with the percentages that are estimated as uncollectible. \table [[Age Group, Accounts Receivable, \table [[Estimated], [Loss %]]], [Current (not past due), $375,000, 0.50%