The balance sheet of Omni, Inc., at the end of last year included the following EXERCISE 8-5 Write-Offs and Recoverles items: Notes receivable from customers Accrued Interest on notes receivable. $ 540,000 Accounts recelvable . 10,600 Less: Allowance for doubtful accounts 2,268,000 54,000 You are to record the following events of the current year in general jovrnal en- INSTRUCTIONS tries: a Accounts receivable of $51,840 are vritten off as uncollectible., b A customner's note for $14,850, on which interest of $810 has been accrued in the accounts, is deemed uncollectible, and both balances are written off against the Allowance for Doubtful Acçounts. c An account receivable for $7,020 previously written off is collected. d Aging of accounts receivable at the end of the current year indicates a need for an $81,000 allowance to cover possible failure to collect accounts currently out- standing. (Consider the effect of entries for a, b, and c on the amount of the Allowence for Doubtful Accounts.)

The balance sheet of Omni, Inc., at the end of last year included the following EXERCISE 8-5 Write-Offs and Recoverles items: Notes receivable from customers Accrued Interest on notes receivable. $ 540,000 Accounts recelvable . 10,600 Less: Allowance for doubtful accounts 2,268,000 54,000 You are to record the following events of the current year in general jovrnal en- INSTRUCTIONS tries: a Accounts receivable of $51,840 are vritten off as uncollectible., b A customner's note for $14,850, on which interest of $810 has been accrued in the accounts, is deemed uncollectible, and both balances are written off against the Allowance for Doubtful Acçounts. c An account receivable for $7,020 previously written off is collected. d Aging of accounts receivable at the end of the current year indicates a need for an $81,000 allowance to cover possible failure to collect accounts currently out- standing. (Consider the effect of entries for a, b, and c on the amount of the Allowence for Doubtful Accounts.)

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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