Hi,Please help with questions, thanks Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded onlyat December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following:Current assets:Receivables, net of allowance for uncollectible accounts of $48,000During 2021, credit sales were $1,840,000, cash collections from customers $1,920,000, and $57,000 in accounts receivable werewritten off. In addition, $4,800 was collected from a customer whose account was written off in 2020. An aging of accounts receivableat December 31, 2021, reveals the following:Age Group0-60 days61-90 days91-120 daysOver 120 daysPercentage of Year-EndReceivables in Group78%20Required:1. Prepare summary journal entries to account for the 2021 write-offs and the collection of the receivable previously written off.2. Prepare the year-end adjusting entry for bad debts according to each of the following situations:55a. Bad debt expense is estimated to be 4% of credit sales for the year.b. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carryingvalue of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts isestimated to be 10% of the year-end balance in accounts receivable.c. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carryingvalue of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts isdetermined by an aging of accounts receivable.Required 1 Required 2 Required 33. For situations (a)-(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2021 balancesheet?Complete this question by entering your answers in the tabs below.Journal entry worksheet2 31PercentUncollectible5%Prepare the year-end adjusting entry for bad debts. (If no entry is required for a transaction/event, select "No journal entry required" inthe first account field.)View transaction letNote: Enter debits before credits.Transactiona.152040Bad debt expense is estimated to be 4% of credit sales for the year.Record entry$ 522,000General JournalClear entryDebitCreditView general Journal Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded onlyat December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following:Current assets:Receivables, net of allowance for uncollectible accounts of $48,000During 2021, credit sales were $1,840,000, cash collections from customers $1,920,000, and $57,000 in accounts receivable werewritten off. In addition, $4,800 was collected from a customer whose account was written off in 2020. An aging of accounts receivableat December 31, 2021, reveals the following:Age Group0-60 days61-90 days91-120 daysOver 120 daysPercentage of Year-EndReceivables in Group70%2055Required:1. Prepare summary Journal entries to account for the 2021 write-offs and the collection of the receivable previously written off.2. Prepare the year-end adjusting entry for bad debts according to each of the following situations:a. Bad debt expense is estimated to be 4% of credit sales for the year.b. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carryingvalue of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts isestimated to be 10% of the year-end balance in accounts receivable.c. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carryingvalue of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts isdetermined by an aging of accounts receivable.3. For situations (a)-(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2021 balancesheet?Complete this question by entering your answers in the tabs below.Journal entry worksheet1 23PercentUncollectible5%152040Required 1 Required 2 Required 3Prepare summary journal entries to account for the 2021 write-offs and the collection of the receivable previously written off. (If no entryis required for a transaction/event, select "No journal entry required" in the first account field.)View transaction listNote: Enter debits before credits.Event1Record accounts receivable written off during the year 2021.Record entryGeneral Journal$ 522,000Clear entryDebitCreditView general Journal

Accounts receivables are those customer accounts to whom business has made credit sales on account…

Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $48,000 During 2021, credit sales were $1,840,000, cash collections from customers $1,920,000, and $57,000 in accounts receivable were written off. In addition, $4,800 was collected from a customer whose account was written off in 2020. An aging of accounts receivable at December 31, 2021, reveals the following: Age Group e-60 days 61-90 days 91-120 days Over 120 days Percentage of Year-End Receivables in Group 70% 20 5 5 Percent Uncollectible 5% 15 20 40 $ 522,000 Required: 1. Prepare summary Journal entries to account for the 2021 write-offs and the collection of the receivable previously written off. 2. Prepare the year-end adjusting entry for bad debts according to each of the following situations: a. Bad debt expense is estimated to be 4% of credit sales for the year. b. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is estimated to be 10% of the year-end balance in accounts receivable. c. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is determined by an aging of accounts receivable. Required 1 Required 2 Required 3 3. For situations (a)-(c) In requirement 2 above, what would be the net amount of accounts receivable reported in the 2021 balance sheet? Complete this question by entering your answers in the tabs below.

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q