The Nile Group is owed $1,010,000 by Scorpion Enterprises under an 10% note with three years remaining to maturity. The prior year of interest was unpaid. Nile estimates credit losses with respect to this receivable and calculates that it will only receive amounts equal to a present value of $885.000. The journal entry that O'Hara would make to record this transaction would include a credit loss as bad debt expense in the amount of: Multiple Choice

The Nile Group is owed $1,010,000 by Scorpion Enterprises under an 10% note with three years remaining to maturity. The prior year of interest was unpaid. Nile estimates credit losses with respect to this receivable and calculates that it will only receive amounts equal to a present value of $885.000. The journal entry that O'Hara would make to record this transaction would include a credit loss as bad debt expense in the amount of: Multiple Choice

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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Required information [The following information applies to the questions displayed below.] At year-end December 31, Chan Company estimates its bad debts as 1.00% of its annual credit sales of $608,000. Chan records its bad debts expense for that estimate. On the following February 1, Chan decides that the $304 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Prepare Chan's journal entries to record the transactions of December 31, February 1, and June 5. View transaction list
Required information [The following information applies to the questions displayed below.) At year-end December 31, Chan Company estimates its bad debts as 0.70% of its annual credit sales of $729,000. Chan records its bad debts expense for that estimate. On the following February 1, Chan decides that the $365 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Prepare Chan's journal entries to record the transactions of December 31, February 1, and June 5.
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On December 31, 2020, Monty Co. performed environmental consulting services for Hayduke Co. Hayduke was short of cash, and Monty Co. agreed to accept a $296,600 zero-interest-bearing note due December 31, 2022, as payment in full. Hayduke is somewhat of a credit risk and typically borrows funds at a rate of 12%. Monty is much more creditworthy and has various lines of credit at 6%. Prepare the journal entry to record the transaction of December 31, 2020, for the Monty Co. (Round present value factor calculations to 5 decimal places, e.g. 1.25124 and final answers to O decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Debit Date Account Titles and Explanation Dec. 31, 2020 eTextbook and Media List of Accounts Assuming Monty Co's fiscal year-end is December 31, prepare the journal entry for December 31, 2021. (Round…
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Required information [The following information applies to the questions displayed below.] At year-end December 31, Chan Company estimates its bad debts as 0.90% of its annual credit sales of $859,000. Chan records its bad debts expense for that estimate. On the following February 1, Chan decides that the $430 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off. Determine the impact of the December 31, February 1, and June 5 transactions on the accounting equation. For each transaction, indicate whether there would be an increase, decrease, or no effect, for Assets, Liabilities, and Equity. (Leave no cells blank.) December 31 February 1 June 5 Assets Liabilities Equity
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