! Required information Problem 7-2A (Static) Estimating and reporting bad debts LO P2, P3 [The following information applies to the questions displayed below.] At December 31, Hawke Company reports the following results for its calendar year. Cash sales Credit sales $ 1,905,000 $ 5,682,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable Allowance for doubtful accounts Problem 7-2A (Static) Part 1 $ 1,270,100 debit $ 16,580 debit Required: 1. Prepare the adjusting entry to record bad debts under each separate assumption. a. Bad debts are estimated to be 1.5% of credit sales. b. Bad debts are estimated to be 1% of total sales. c. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible. Adjusting entries (all dated December 31).
! Required information Problem 7-2A (Static) Estimating and reporting bad debts LO P2, P3 [The following information applies to the questions displayed below.] At December 31, Hawke Company reports the following results for its calendar year. Cash sales Credit sales $ 1,905,000 $ 5,682,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable Allowance for doubtful accounts Problem 7-2A (Static) Part 1 $ 1,270,100 debit $ 16,580 debit Required: 1. Prepare the adjusting entry to record bad debts under each separate assumption. a. Bad debts are estimated to be 1.5% of credit sales. b. Bad debts are estimated to be 1% of total sales. c. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible. Adjusting entries (all dated December 31).
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
100%

Transcribed Image Text:Problem 7-2A (Static) Part 2
2. Bad debts are estimated to be 1.5% of credit sales. Show how Accounts Receivable and the Allowance for Doubtful Accounts
appear on its December 31 balance sheet.
Current assets:
Accounts receivable
Less: Allowance for doubtful accounts
Problem 7-2A (Static) Part 3
$
3. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible. Show how Accounts Receivable and the
Allowance for Doubtful Accounts appear on its December 31 balance sheet.
Current assets:
$
![!
Required information
Problem 7-2A (Static) Estimating and reporting bad debts LO P2, P3
[The following information applies to the questions displayed below.]
At December 31, Hawke Company reports the following results for its calendar year.
Cash sales
Credit sales
$ 1,905,000
$ 5,682,000
In addition, its unadjusted trial balance includes the following items.
Accounts receivable
Allowance for doubtful accounts
Problem 7-2A (Static) Part 1
$ 1,270,100 debit
$ 16,580 debit
Required:
1. Prepare the adjusting entry to record bad debts under each separate assumption.
a. Bad debts are estimated to be 1.5% of credit sales.
b. Bad debts are estimated to be 1% of total sales.
c. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible.
Adjusting entries (all dated December 31).](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5ffb9d2a-e56a-437d-84a8-122c459e8526%2Ffb94c184-7de2-47a1-9ce2-fc616342f11b%2Fhm6hu5q_processed.png&w=3840&q=75)
Transcribed Image Text:!
Required information
Problem 7-2A (Static) Estimating and reporting bad debts LO P2, P3
[The following information applies to the questions displayed below.]
At December 31, Hawke Company reports the following results for its calendar year.
Cash sales
Credit sales
$ 1,905,000
$ 5,682,000
In addition, its unadjusted trial balance includes the following items.
Accounts receivable
Allowance for doubtful accounts
Problem 7-2A (Static) Part 1
$ 1,270,100 debit
$ 16,580 debit
Required:
1. Prepare the adjusting entry to record bad debts under each separate assumption.
a. Bad debts are estimated to be 1.5% of credit sales.
b. Bad debts are estimated to be 1% of total sales.
c. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible.
Adjusting entries (all dated December 31).
Expert Solution

This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps

Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you


Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,

Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,


Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,

Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON

Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education

Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education