S9-6 Applying the allowance method (percent-of-sales) to account for Learning Obje uncollectibles During its first year of operations, Fall Wine Tour earned net credit sales of $311,000. Industry experience suggests that bad debts will amount to 3% of net credit sales. At December 31, 2018, accounts receivable total $44,000. The company uses the allowance method to account for uncollectibles. Requirements 1. Journalize Fall Wine Tour's Bad Debts Expense using the percent-of-sales method. 2. Show how to report accounts receivable on the balance sheet at December 31, 2018.
S9-6 Applying the allowance method (percent-of-sales) to account for Learning Obje uncollectibles During its first year of operations, Fall Wine Tour earned net credit sales of $311,000. Industry experience suggests that bad debts will amount to 3% of net credit sales. At December 31, 2018, accounts receivable total $44,000. The company uses the allowance method to account for uncollectibles. Requirements 1. Journalize Fall Wine Tour's Bad Debts Expense using the percent-of-sales method. 2. Show how to report accounts receivable on the balance sheet at December 31, 2018.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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S9-6. Thank you
Transcribed Image Text:S9-6 Applying the allowance method (percent-of-sales) to account for
uncollectibles
Learning Objective 3
During its first year of operations, Fall Wine Tour earned net credit sales of $311,000.
Industry experience suggests that bad debts will amount to 3% of net credit sales.
At December 31, 2018, accounts receivable total $44,000. The company uses the
allowance method to account for uncollectibles.
Requirements
1. Journalize Fall Wine Tour's Bad Debts Expense using the percent-of-sales method.
2. Show how to report accounts receivable on the balance sheet at December 31,
2018.
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