Miller Foods Corporation was formed in 2015 with the merger of Tashamo Corporation and Grouch Mayor Companies. The company reported the following rounded amounts for the year ended December 29, 2018 (all amounts in millions): Debits $ 1,140 Credits Accounts Receivable Allowance for Doubtful Accounts Sales (assume all on credit) Required: 1. Assume Miller Foods uses 3/4 of 1 percent of sales to estimate its Bad Debt Expense for the year. Prepare the adjusting journal entry required for the year, assuming no Bad Debt Expense has been recorded yet. 2. Assume instead Miller Foods uses the aging of accounts receivable method and estimates that $82 of its Accounts Receivable will be uncollectible. Prepare the adjusting journal entry required at December 29, 2018, for recording Bad Debt Expense. 3. Assume instead Miller Foods's uses the aging of accounts receivable method and estimates that $82 of its Accounts Receivable will be uncollectible. Prepare the adjusting journal entry required at December 29, 2018, for recording Bad Debt Expense assuming Miller Foods's unadjusted balance in Allowance for Doubtful Accounts at December 29, 2018, was a debit balance of $22. 4. If one of Miller Foods's customers declared bankruptcy, what journal entry would be used to write off its $20 balance? $ 28 18,500
Miller Foods Corporation was formed in 2015 with the merger of Tashamo Corporation and Grouch Mayor Companies. The company reported the following rounded amounts for the year ended December 29, 2018 (all amounts in millions): Debits $ 1,140 Credits Accounts Receivable Allowance for Doubtful Accounts Sales (assume all on credit) Required: 1. Assume Miller Foods uses 3/4 of 1 percent of sales to estimate its Bad Debt Expense for the year. Prepare the adjusting journal entry required for the year, assuming no Bad Debt Expense has been recorded yet. 2. Assume instead Miller Foods uses the aging of accounts receivable method and estimates that $82 of its Accounts Receivable will be uncollectible. Prepare the adjusting journal entry required at December 29, 2018, for recording Bad Debt Expense. 3. Assume instead Miller Foods's uses the aging of accounts receivable method and estimates that $82 of its Accounts Receivable will be uncollectible. Prepare the adjusting journal entry required at December 29, 2018, for recording Bad Debt Expense assuming Miller Foods's unadjusted balance in Allowance for Doubtful Accounts at December 29, 2018, was a debit balance of $22. 4. If one of Miller Foods's customers declared bankruptcy, what journal entry would be used to write off its $20 balance? $ 28 18,500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Question
Transcribed Image Text:Miller Foods Corporation was formed in 2015 with the merger of Tashamo Corporation and Grouch Mayor Companies. The company
reported the following rounded amounts for the year ended December 29, 2018 (all amounts in millions):
Debits
$ 1,140
Accounts Receivable
Allowance for Doubtful Accounts
Sales (assume all on credit)
Required:
1. Assume Miller Foods uses 3/4 of 1 percent of sales to estimate its Bad Debt Expense for the year. Prepare the adjusting journal entry
required for the year, assuming no Bad Debt Expense has been recorded yet.
2. Assume instead Miller Foods uses the aging of accounts receivable method and estimates that $82 of its Accounts Receivable will
be uncollectible. Prepare the adjusting journal entry required at December 29, 2018, for recording Bad Debt Expense.
3. Assume instead Miller Foods's uses the aging of accounts receivable method and estimates that $82 of its Accounts Receivable will
be uncollectible. Prepare the adjusting journal entry required at December 29, 2018, for recording Bad Debt Expense assuming
Miller Foods's unadjusted balance in Allowance for Doubtful Accounts at December 29, 2018, was a debit balance of $22.
4. If one of Miller Foods's customers declared bankruptcy, what journal entry would be used to write off its $20 balance?
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Complete this question by entering your answers in the tabs below.
Journal entry worksheet
18,500
Required 1 Required 2 Required 3 Required 4
Assume Miller Foods uses 3/4 of 1 percent of sales to estimate its Bad Debt Expense for the year. Prepare the adjusting journal entry
required for the year, assuming no Bad Debt Expense has been recorded yet. (If no entry is required for a transaction/event, select "No
Journal Entry Required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Round your
answers to the nearest whole number.)
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