Selected accounts from Fair Trader Co.’s adjusted trial balance for the year ended December 31 follow. Prepare its income statement. Factoring fees . $ 300 Interest revenue. $ 3,000 Insurance expense. 4,000 Salaries expense . 22,000 Sales. 50,000 Supplies expense. 200 Rent expense. 15,000 Bad debt expense . 1,000

Selected accounts from Fair Trader Co.’s adjusted trial balance for the year ended December 31 follow. Prepare its income statement. Factoring fees . $ 300 Interest revenue. $ 3,000 Insurance expense. 4,000 Salaries expense . 22,000 Sales. 50,000 Supplies expense. 200 Rent expense. 15,000 Bad debt expense . 1,000

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter9: Receivables

Section: Chapter Questions

Problem 17E: Casebolt Company wrote off the following accounts receivable as uncollectible for the first year of...

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Casebolt Company wrote off the following accounts receivable as uncollectible for the first year of its operations ending December 31: a. Journalize the write-offs under the direct write-off method. b. Journalize the write-offs under the allowance method. Also, journalize the adjusting entry for uncollectible accounts. The company recorded 5,250,000 of credit sales during the year. Based on past history and industry averages, % of credit sales are expected to be uncollectible. c. How much higher (lower) would Casebolt Companys net income have been under the direct write-off method than under the allowance method?
Jars Plus recorded $861,430 in credit sales for the year and $488,000 in accounts receivable. The uncollectible percentage is 2.3% for the income statement method, and 3.6% for the balance sheet method. A. Record the year-end adjusting entry for 2018 bad debt using the income statement method. B. Record the year-end adjusting entry for 2018 bad debt using the balance sheet method. C. Assume there was a previous debit balance in Allowance for Doubtful Accounts of $10,220, record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method. D. Assume there was a previous credit balance in Allowance for Doubtful Accounts of $5,470, record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method.
At the end of the prior year, Durney's Outdoor Outfitters reported the following information. Accounts Receivable (Gross) (A) Accounts Receivable, December 31, prior year $ 48,091 8,394 Allowance for Doubtful Accounts (XA) Accounts Receivable (Net) (A) $ 39,697 During the current year, sales on account were $304,673, collections on account were $289,950, write-offs of bad debts were $6,979, and the bad debt expense adjustment was $4,695. Required: 1-a. Complete the Accounts Receivable and Allowance for Doubtful Accounts T-accounts to determine the balance sheet values. 1-b. Complete the amounts related to Accounts Receivable and Bad Debt Expense that would be reported on the income statement for the current year. 1-c. Complete the amounts related to Accounts Receivable and Bad Debt Expense that would be reported on the balance sheet for the current year. × Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 1C Complete the…
Yates Company's records provide the following information concerning certain account balances and changes in these account balances during the current year. Accounts Receivable: Jan. 1, balance $41,000, Dec. 31, balance $55,000, uncollectible accounts written off during the year, $6,000; accounts receivable collected during the year, $159,000. Compute Sales revenue for the year.
At the end of the prior year, Durney's Outdoor Outfitters reported the following information. Accounts Receivable, December 31, prior year Accounts Receivable (Gross) (A) $ 48,283 Allowance for Doubtful Accounts (XA) 8,474 Accounts Receivable (Net) (A) $ 39,809 During the current year, sales on account were $306,673, collections on account were $290,750, write-offs of bad debts were $7,059, and the bad debt expense adjustment was $4,775. Required: 1-a. Complete the Accounts Receivable and Allowance for Doubtful Accounts T-accounts to determine the balance sheet values. 1-b. Complete the amounts related to Accounts Receivable and Bad Debt Expense that would be reported on the income statement for the current year. 1-c. Complete the amounts related to Accounts Receivable and Bad Debt Expense that would be reported on the balance sheet for the current year.
Ruiz Company's Accounts Receivable balance at December 31 was $150,000 and there was a balance of $700 in the Allowance for Uncollectible Accounts. Sales for the year were $900,000. The firm estimates credit losses for the year at 1.5% of sales. After the appropriate adjusting entry is made for credit losses, what is the net amount of accounts receivable included in the current assets at year-end? Select one: a. $150,000 b. $135,800 c. $162,700 d. $138,700 e. None of the above
On December 31 of last year, the balance sheet of Union Company had accounts receivable of $74,5000 and a credit balance in Allowance for Uncollectible Accounts of $5,075. During the current year, Union's financial records included the following selected activities: Sales on accounts $298,750 Sales returns and allowances, $18,250 Collections from customers, $287,500 Accounts written off as worthless, $4,000 1) Prepare T accounts for Accounts receivable and Allowance for uncollectible accounts. Enter the beginning balances and show the effects on these accounts of the items listed above. Determine the ending balance of each account.
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Selected accounts from Bennett Co.’s adjusted trial balance for the year ended December 31 follow. Prepare a classified balance sheet. Note: Allowance for doubtful accounts is subtracted from accounts receivable on the company’s balance sheet. Prepaid rent . $ 1,000 Accounts payable. $2,500 Accounts receivable. 10,000 Allowance for doubtful accounts. 500 Cash . 12,000 Notes payable (due in 10 years). 6,000 Total equity. 18,000 Notes receivable (due in 4 years) . 4,000
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Maxwell Inc. analyzed its accounts receivable balances at December 31, and arrived at the aged balances listed below, along with the percentage that is estimated to be uncollectible: % Considered Age Group Balance Uncollectible 0-30 days past due $100,000 1% 31-60 days past due 18,000 3% 61-120 days past due 20,000 6% 121-180 days past due 7,000 10% Over 180 days past due 2,000 20% $147,000 The company handles credit losses using the allowance method.The credit balance of the Allowance for Doubtful Accounts is $840 on December 31, before any adjustments.a. Determine the amount of the adjustment for estimated credit losses on December 31.$Answerb. Determine the financial statement effect of a write off of Porter Company’s account on the following May 12, in the amount of $480.Use negative signs with answers, when appropriate.If a transaction increases and decreases the same Balance Sheet category, enter the increase amount in the first row and the…
The ledger of Hixson Company at the end of the current year shows Accounts Receivable $127, 200, Sales $ 130,000, and Sales Returns and Allowances $4,000. Instructions: a. If Allowance for Doubtful Accounts has a credit balance of $1, 230 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 2% of net sales b. If Allowance for Doubtful Accounts has a debit balance of $910 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 6% of accounts entry at December 31, assuming bad debts are expected to be 6% of accounts receivable.