Providing for Doubtful Accounts At the end of the current year, the accounts receivable account has a balance of $3,060,000 and sales for the year total $48,500,000. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. X Open spreadsheet Determine the amount of the adjusting entry to provide for doubtful accounts under each of the following independent assumptions: a. The allowance account before adjustment has a negative balance of $(18,800). An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $350,000. b. The allowance account before adjustment has a positive balance of $9,400. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $300,000. Feedback Check My Work a-b. Using the percent of sales method, Bad Debt Expense is determined by multiplying sales by the estimated percentage uncollectible. Using the analysis of receivables method, Bad Debt Expense is determined by completing an analysis of the aging of the receivables and then comparing that total with the current balance in the allowance account. The difference is recorded as Bad Debt Expense.
Providing for Doubtful Accounts At the end of the current year, the accounts receivable account has a balance of $3,060,000 and sales for the year total $48,500,000. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below. X Open spreadsheet Determine the amount of the adjusting entry to provide for doubtful accounts under each of the following independent assumptions: a. The allowance account before adjustment has a negative balance of $(18,800). An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $350,000. b. The allowance account before adjustment has a positive balance of $9,400. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $300,000. Feedback Check My Work a-b. Using the percent of sales method, Bad Debt Expense is determined by multiplying sales by the estimated percentage uncollectible. Using the analysis of receivables method, Bad Debt Expense is determined by completing an analysis of the aging of the receivables and then comparing that total with the current balance in the allowance account. The difference is recorded as Bad Debt Expense.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
9
Transcribed Image Text:Providing for Doubtful Accounts
At the end of the current year, the accounts receivable account has a balance of $3,060,000 and sales for the year total $48,500,000.
This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below.
X
Open spreadsheet
Determine the amount of the adjusting entry to provide for doubtful accounts under each of the following independent assumptions:
a. The allowance account before adjustment has a negative balance of $(18,800). An aging of the accounts in the customer ledger indicates estimated doubtful accounts
of $350,000.
b. The allowance account before adjustment has a positive balance of $9,400. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of
$300,000.
Feedback
Check My Work
a-b. Using the percent of sales method, Bad Debt Expense is determined by multiplying sales by the estimated percentage uncollectible. Using the analysis of
receivables method, Bad Debt Expense is determined by completing an analysis of the aging of the receivables and then comparing that total with the current
balance in the allowance account. The difference is recorded as Bad Debt Expense.
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