I need assistance with this financial accounting problem using valid financial procedures. North wind Logistics reported a net profit of $92,000 for the year ended31 December 20X4. Later, it was discovered that $20,000 paid for adelivery van was incorrectly recorded as an expense. Company policy isto depreciate vans at 20% per year (straight-line), with a full year'sdepreciation in the year of purchase.What would the corrected net profit be after adjusting this error?

Step 1: Define Adjusting Net Profit for ErrorWhen an asset is incorrectly expensed instead of…

Answered: North wind Logistics reported a net…

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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I am looking for the correct answer to this financial accounting question with appropriate explanations.
Grant Company has had a record-breaking year in termsof growth in sales and profitability. However, marketresearch indicates that it will experience operating lossesin two of its major businesses next year. The controllerhas proposed that the company record a provision forthese future losses this year, since it can afford to take thecharge and still show good results. Advise the controlleron the appropriateness of this charge.
Assume that Simple Co. had credit sales of $259,000 and cost of goods sold of $159,000 for the period. Simple uses the aging method and estimates that the appropriate ending balance in the Allowance for Doubtful Accounts is $3,900. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $340. What amount of Bad Debt Expense would the company record as an end-of-period adjustment?
Assume that Simple Company had credit sales of $259,000 and cost of goods sold of $159,000 for the period. Simple uses the aging method and estimates that the appropriate ending balance in the Allowance for Doubtful Accounts is $3,900. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $340. Required: What amount of Bad Debt Expense would the company record as an end-of-period adjustment? Bad Debt Expense
During 2021, its first year of operations, Hollis Industries recorded sales of $10,600,000 and experienced returns of $720,000. Cost of goods sold totaled $6,360,000 (60% of sales). The company estimates that 8% of all sales will be returned. Prepare the year-end adjusting journal entries to account for anticipated sales returns under the assumption that all sales are made for cash (no accounts receivable are outstanding). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Call Systems Company,a telephone service and supply company,hasjust completed its fourth year of operations.The direct write-off method of recording bad debt expense has been used during the entire period . Because of substantial increases in sales volume and the amount of uncollectible accounts,the company is considering changing to the allowance method.Information is r·equested as to the effect that an annual provision of 1% of sales would have had on the amount of bad debt expense reported for each of the past four years.It is also considered desirable to know what the balance of Allowance for Doubtful Accounts would have been at the end of each year. The following data have been obtained from the accounts Instructions 1.Assemble the desired data,using the following column headings: 2. Experience during the first four years of operations indicated that the receivables either were collected within two years or had to be written off as uncollectible . Does the estimate of 1% of…
1.) Beltline Co. had credit sales of $100,000 for the year, and based on experience estimates that approximately 1% of these sales will be uncollectible. Under the percent of sales method, a.the adjusting entry to record the uncollectible sales would involve a debit to Allowance for Doubtful Accounts and a credit to Bad Debt Expense. b.the estimated uncollectible sales should not be recorded until there is firm evidence that a customer will not pay. c.the estimated bad debt expense is $1,000. d.the estimated bad debt expense is $10,000. 2.) Under the percentage of receivables method theory, a.the majority of accounts receivable portion will not be collected. b.some portion of the existing accounts receivable will not be collected. c.the percentage of uncollectible accounts is calculated as Average Uncollectible Accounts divided by Average Accounts Receivable. d."some portion of the existing accounts receivable will not be collected" and "the percentage of uncollectible…
During fiscal year 2012, Byrd Inc. wrote-off $8,000 of customer accounts as uncollectible. Which of the following items would be decreased by these write-offs? (indicate all that apply) a. Accounts Receivable b. Allowance for Doubtful Accounts c. Net Income d. Bad Debt Expense e. Cash flow from Operations
An entity was offering premium as a sales promotion scheme and that during the year it purchased 10,000 premiums for P20 each. Customers need to remit 10 boxes and P5 to redeem one premium. Assume there were no redemptions during the first year of the promotion, which of the following statements would be correct if it uses the revenue approach? a. The entity will report an inventory of premiums at the net cost of P15. Tb. he entity will report an estimated liability equal to the premium expense. c. None of the other choices are correct. Td. he entity will not report any expense since there were no redemption. e. No accounting liability shall be recognized since there were no redemptions.
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6.Allowance for Doubtful Accounts has a credit balance of $1,300 at the end of the year (before adjustment). The company prepares an analysis of customers' accounts to estimate the amount of uncollectible accounts of $41,900. Which of the following adjusting entries would be made to record the bad debt expense for the year? Bacon Company acquired new machinery with a price of $15,200 by trading in similar old machinery and paying $12,700. The old machinery originally cost $9,000 and had accumulated depreciation of $5,000. In recording this transaction, Bacon Company should record Group of answer choices
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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