The following information is from the records of Mountainview Camera Shop: Accounts receivable, December 31, 2024 Net credit sales for 2024 Accounts written off as uncollectible during 2024 15,000 Cash sales during 2024 40,000 The company uses the direct write-off method for bad debts. What is the amount of bad debts expense? A. $15,000 B. $82,000 C. $40,000 D. $65,000 $82,000 (debit) 162,000

The following information is from the records of Mountainview Camera Shop: Accounts receivable, December 31, 2024 Net credit sales for 2024 Accounts written off as uncollectible during 2024 15,000 Cash sales during 2024 40,000 The company uses the direct write-off method for bad debts. What is the amount of bad debts expense? A. $15,000 B. $82,000 C. $40,000 D. $65,000 $82,000 (debit) 162,000

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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An excerpt from the trial balance of ABC Company shows the following: Accounts Receivable $1,000,000Allowance for Bad debts $10,000Sales $5,000,000Sales discount $3,000Sales returns and allowances $30,000 It is the companys policy to provide 1% of net credit sales as bad debts Cash sales amounted to $2,000,000 Questions: 1) Adjusting entries on December 312) Balance of Bad debts expense as of December 313) Balance of Allowance for Bad debts as of December 314) Should the adjustment was not made, what would be the effect on current assets?
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F. The records of Stedman Corp. included the following accounts, all of which are normal balances: $1,200,000 900,000 180,000 200,000 3,000 5,000 Cash sales Credit sales Balance in accounts receivable, 12/31/20 Balance in accounts receivable, 12/31/21 Balance in allowance for doubtful accounts, 12/31/20 Accounts written off as uncollectible during 2021 Stedman estimates bad debts as 2% of receivables at year end to be uncollectible. Write any necessary adjusting entry.
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Question: A customer who owes Berry Sales Company $2,000 is declared bankrupt by a federal court. What journal entry would be made to write off this account: A. Allowance for Uncollectable Accounts 2,000 Accounts Receivable/Customer Account 2,000 B. Accounts Receivable/Customer Account 2,000 Allowance for Uncollectable Accounts 2,000 C. Accounts Receivable 2,000 Notes Receivable 2,000 D. Cash 2,000 Accounts Receivable 2,000
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Entries to Write Off Accounts Receivable Capstone Solutions Company, a computer consulting firm, has decided to write off the $45,800 balance of an account owed by a customer, Philadelphia Inc. a. Journalize the entry to record the write-off, assuming that the direct write-off method is used. If an amount box does not require an entry, leave it blank. Bad Debt Expense Accounts Receivable-Philadelphia Inc. ✔ Feedback 45,800 Check My Work Remember that under the direct write-off method, Bad Debt Expense is not recorded until the customer's account is determined to be worthless. Feedback 45,800 b. Journalize the entry to record the write-off, assuming that the allowance method is used. If an amount box does not require an entry, leave it blank. ✓ Check My Work
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