! Required Information Exercise 7-2A (Algo) Accounting for uncollectible accounts: allowance method LO 7-1 [The following information applies to the questions displayed below.] Holmes Cleaning Service began operation on January 1, Year 1. The company experienced the following events for its first year of operations. Events Affecting Year 1: 1. Provided $130,000 of cleaning services on account. 2. Collected $97,500 cash from accounts receivable. 3. Paid salaries of $42,000 for the year. 4. Adjusted the accounts to reflect management's expectations that uncollectible accounts expense would be $1,900. The expense was determined using the percent of revenue method. Exercise 7-2A (Algo) Part c Prepare an income statement, balance sheet, and statement of cash flows for Year 1. Complete this question by entering your answers in the tabs below. Req C1 Reg C2 Assets Prepare a balance sheet for Year 1. (Enter amounts to be deducted with a minus sign.) Req C3 Total assets Liabilities Stockholders' equity Retained earnings HOLMES CLEANING SERVICE Balance Sheet As of December 31, Year 1 Cash Accounts receivable Less: Allowance for doubtful accounts Total stockholders' equity Total liabilities and stockholders' equity $ 32,500 $ 86,100 $ 0 $ $ $ 32,500 32,500 0 86,100 86,100
! Required Information Exercise 7-2A (Algo) Accounting for uncollectible accounts: allowance method LO 7-1 [The following information applies to the questions displayed below.] Holmes Cleaning Service began operation on January 1, Year 1. The company experienced the following events for its first year of operations. Events Affecting Year 1: 1. Provided $130,000 of cleaning services on account. 2. Collected $97,500 cash from accounts receivable. 3. Paid salaries of $42,000 for the year. 4. Adjusted the accounts to reflect management's expectations that uncollectible accounts expense would be $1,900. The expense was determined using the percent of revenue method. Exercise 7-2A (Algo) Part c Prepare an income statement, balance sheet, and statement of cash flows for Year 1. Complete this question by entering your answers in the tabs below. Req C1 Reg C2 Assets Prepare a balance sheet for Year 1. (Enter amounts to be deducted with a minus sign.) Req C3 Total assets Liabilities Stockholders' equity Retained earnings HOLMES CLEANING SERVICE Balance Sheet As of December 31, Year 1 Cash Accounts receivable Less: Allowance for doubtful accounts Total stockholders' equity Total liabilities and stockholders' equity $ 32,500 $ 86,100 $ 0 $ $ $ 32,500 32,500 0 86,100 86,100
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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
5
![Required Information
Exercise 7-2A (Algo) Accounting for uncollectible accounts: allowance method LO 7-1
[The following information applies to the questions displayed below.]
Holmes Cleaning Service began operation on January 1, Year 1. The company experienced the following events for its first
year of operations.
Events Affecting Year 1:
1. Provided $130,000 of cleaning services on account.
2. Collected $97,500 cash from accounts receivable.
3. Paid salaries of $42,000 for the year.
4. Adjusted the accounts to reflect management's expectations that uncollectible accounts expense would be $1,900.
The expense was determined using the percent of revenue method.
Exercise 7-2A (Algo) Part c
Prepare an income statement, balance sheet, and statement of cash flows for Year 1.
Complete this question by entering your answers in the tabs below.
Req C1
Req C2
Req C3
Prepare a balance sheet for Year 1. (Enter amounts to be deducted with a minus sign.)
Assets
Cash
Accounts receivable
HOLMES CLEANING SERVICE
Balance Sheet
As of December 31, Year 1
$ 32,500
Less: Allowance for doubtful accounts
Total assets
Liabilities
Stockholders' equity
Retained earnings
Total stockholders' equity
Total liabilities and stockholders' equity
32,500
$
32,500
$
0
$
86,100
$
이
86,100
$ 88,100](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3c6373c8-9fdf-490e-8350-1edf2f7d5943%2Ffe679924-880b-40bb-83bc-f677003add55%2Fhi7p3b_processed.png&w=3840&q=75)
Transcribed Image Text:Required Information
Exercise 7-2A (Algo) Accounting for uncollectible accounts: allowance method LO 7-1
[The following information applies to the questions displayed below.]
Holmes Cleaning Service began operation on January 1, Year 1. The company experienced the following events for its first
year of operations.
Events Affecting Year 1:
1. Provided $130,000 of cleaning services on account.
2. Collected $97,500 cash from accounts receivable.
3. Paid salaries of $42,000 for the year.
4. Adjusted the accounts to reflect management's expectations that uncollectible accounts expense would be $1,900.
The expense was determined using the percent of revenue method.
Exercise 7-2A (Algo) Part c
Prepare an income statement, balance sheet, and statement of cash flows for Year 1.
Complete this question by entering your answers in the tabs below.
Req C1
Req C2
Req C3
Prepare a balance sheet for Year 1. (Enter amounts to be deducted with a minus sign.)
Assets
Cash
Accounts receivable
HOLMES CLEANING SERVICE
Balance Sheet
As of December 31, Year 1
$ 32,500
Less: Allowance for doubtful accounts
Total assets
Liabilities
Stockholders' equity
Retained earnings
Total stockholders' equity
Total liabilities and stockholders' equity
32,500
$
32,500
$
0
$
86,100
$
이
86,100
$ 88,100
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