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Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded at December 31, the company's fiscal year-end. The 2023 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $44,000 $ 502,000 During 2024, credit sales were $1,820,000, cash collections from customers $1,900,000, and $53,000 in accounts receivable wer vritten off. In addition, $4,400 was collected from a customer whose account was written off in 2023. An aging of accounts receiv at December 31, 2024, reveals the following: Age Group 0-60 days 61-90 days 91-120 days Over 120 days Percentage of Year-End Receivables in Group 65% 15 15 5 Percent Uncollectible 4% 10 30 50 Required: 1. Prepare summary journal entries to account for the 2024 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 3% 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. 3. For situations (a)-(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2024 bal

Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded at December 31, the company's fiscal year-end. The 2023 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $44,000 $ 502,000 During 2024, credit sales were $1,820,000, cash collections from customers $1,900,000, and $53,000 in accounts receivable wer vritten off. In addition, $4,400 was collected from a customer whose account was written off in 2023. An aging of accounts receiv at December 31, 2024, reveals the following: Age Group 0-60 days 61-90 days 91-120 days Over 120 days Percentage of Year-End Receivables in Group 65% 15 15 5 Percent Uncollectible 4% 10 30 50 Required: 1. Prepare summary journal entries to account for the 2024 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 3% 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. 3. For situations (a)-(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2024 bal

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Complete this question by entering your answers in the tabs below. Required 1 Required 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 3% 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. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet < 1 Bad debt expense is estimated to be 3% of credit sales for the year. Transaction Required 3 2 3 Note: Enter debits before credits. a. Record entry a. b. C. Show Transcribed Text General Journal Clear entry Net accounts receivable reported Debit < Required 2 Credit View general journal Required 1 Required 2 Required 3 For situations (a)-(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2024 balance sheet? > Show less A Required 3 >
Transcribed Image Text:Complete this question by entering your answers in the tabs below. Required 1 Required 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 3% 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. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field. View transaction list Journal entry worksheet < 1 Bad debt expense is estimated to be 3% of credit sales for the year. Transaction Required 3 2 3 Note: Enter debits before credits. a. Record entry a. b. C. Show Transcribed Text General Journal Clear entry Net accounts receivable reported Debit < Required 2 Credit View general journal Required 1 Required 2 Required 3 For situations (a)-(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2024 balance sheet? > Show less A Required 3 >
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 2023 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $44,000 During 2024, credit sales were $1,820,000, cash collections from customers $1,900,000, and $53,000 in accounts receivable were written off. In addition, $4,400 was collected from a customer whose account was written off in 2023. An aging of accounts receivable at December 31, 2024, reveals the following: Age Group 0-60 days 61-90 days 91-120 days Over 120 days Percentage of Year-End Receivables in Group 65% 15 15 5 Percent Uncollectible 4% Required: 1. Prepare summary journal entries to account for the 2024 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: 10 30 50 a. Bad debt expense is estimated to be 3% 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. $ 502,000 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 2024 balance sheet? Complete this question by entering your answers in the tabs below. View transaction list Journal entry worksheet Prepare summary journal entries to account for the 2024 write-offs and the collection of the receivable previously written off. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
Transcribed Image Text: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 2023 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $44,000 During 2024, credit sales were $1,820,000, cash collections from customers $1,900,000, and $53,000 in accounts receivable were written off. In addition, $4,400 was collected from a customer whose account was written off in 2023. An aging of accounts receivable at December 31, 2024, reveals the following: Age Group 0-60 days 61-90 days 91-120 days Over 120 days Percentage of Year-End Receivables in Group 65% 15 15 5 Percent Uncollectible 4% Required: 1. Prepare summary journal entries to account for the 2024 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: 10 30 50 a. Bad debt expense is estimated to be 3% 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. $ 502,000 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 2024 balance sheet? Complete this question by entering your answers in the tabs below. View transaction list Journal entry worksheet Prepare summary journal entries to account for the 2024 write-offs and the collection of the receivable previously written off. Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
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