Required information [The following information applies to the questions displayed below.] The general ledger of Pop's Fireworks includes the following account balances on December 31, 2024: Accounts Cash Debit Credit $21,200 Accounts Receivable 41,500 Allowance for Uncollectible Accounts $2,200 Supplies 6,700 Notes Receivable (8%, due in 2 years) 10,000 Land 85,000 Accounts Payable 12,300 Common Stock 106,000 Retained Earnings 29,900 124,800 70,900 24,200 15,700 $275,200 $275,200 Service Revenue Salaries Expense Utilities Expense Supplies Expense Totals In addition, the following transactions occurred during 2024 and are not yet reflected in the account balances above: 1. Provided additional services on account for $7,000. All services on account include terms 2/10, n/30. 2. Received cash from customers within 10 days of the services being provided on account. The customers were originally charged $5,000. 3. Wrote off customer accounts of $1,500 as uncollectible.

Required information [The following information applies to the questions displayed below.] The general ledger of Pop's Fireworks includes the following account balances on December 31, 2024: Accounts Cash Debit Credit $21,200 Accounts Receivable 41,500 Allowance for Uncollectible Accounts $2,200 Supplies 6,700 Notes Receivable (8%, due in 2 years) 10,000 Land 85,000 Accounts Payable 12,300 Common Stock 106,000 Retained Earnings 29,900 124,800 70,900 24,200 15,700 $275,200 $275,200 Service Revenue Salaries Expense Utilities Expense Supplies Expense Totals In addition, the following transactions occurred during 2024 and are not yet reflected in the account balances above: 1. Provided additional services on account for $7,000. All services on account include terms 2/10, n/30. 2. Received cash from customers within 10 days of the services being provided on account. The customers were originally charged $5,000. 3. Wrote off customer accounts of $1,500 as uncollectible.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Bad Debts

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.

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