How much? Upon completing an aging analysis of accountsreceivable, the accountant for Richmond Industriesprepared an aging of accounts receivable andestimated that $7,200 of the $115,400 accountsreceivable balance would be uncollectible. Theallowance for doubtful accounts had a $620 debitbalance at year-end prior to adjustment.How much is the bad debt expense?a. $620 b. $6,580 c. $7,820 d. $7,200

Explanation of Bad Debt Expense:Bad debt expense refers to the estimated loss that a company incurs…

Answered: Upon completing an aging analysis of…

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter5: Sales And Receivables

Section: Chapter Questions

Problem 85APSA: Determining Bad Debt Expense Using the Aging Method At the beginning of the year, Tennyson Auto...

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Determining Bad Debt Expense Using the Aging Method At the beginning of the year, Tennyson Auto Parts had an accounts receivable balance of $31,800 and a balance in the allowance for doubtful accounts of $2,980 (credit). During the year, Tennyson had credit sales of $624,300, collected accounts receivable in the amount of $602,700, wrote off $18,600 of accounts receivable, and had the following data for accounts receivable at the end of the period: Required: 1. Determine the desired post adjustment balance in allowance for doubtful accounts. 2. Determine the balance in allowance for doubtful accounts before the bad debt expense adjusting entry is posted. 3. Compute bad debt expense. 4. Prepare the adjusting entry to record bad debt expense.
Entries for bad debt expense under the direct write-off and allowance methods The following selected transactions were taken from the records of Rustic Tables Company for the year ending December 31: A. Journalize the transactions under the direct write-off method. B. Journalize the transactions under the allowance method, assuming that the allowance account had a beginning balance of 36,000 at the beginning of the year and the company uses the analysis of receivables method. Rustic Tables Company prepared the following aging schedule for its accounts receivable: C. How much higher (lower) would Rustic Tables net income have been under the direct write-off method than under the allowance method?
Bad Debt Expense: Aging Method Glencoe Supply had the following accounts receivable aging schedule at the end of a recent year. The balance in Glencoes allowance for doubtful accounts at the beginning of the year was $58,620 (credit). During the year, accounts in the total amount of $62,400 were written off. Required: 1. Determine bad debt expense. 2. Prepare the journal entry to record bad debt expense. 3. If Glencoe had written off $90,000 of receivables as uncollectible during the year, how much would bad debt expense reported on the income statement have changed?
Estimating allowance for doubtful accounts Evers Industries has a past history of uncollectible accounts, as follows. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule you completed in Exercise 8-8.
Bristax Corporation recorded $1,385,660 in credit sales for the year, and $732,410 in accounts receivable. The uncollectible percentage is 3.1% for the income statement method and 4.5% 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 $20,550; 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 $17,430; record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method.
The following accounts receivable information pertains to Luxury Cruises. A. Determine the estimated uncollectible bad debt for Luxury Cruises in 2018 using the balance sheet aging of receivables method. B. Record the year-end 2018 adjusting journal entry for bad debt. C. Assume there was a previous debit balance in Allowance for Doubtful Accounts of $187,450; record the year-end entry for bad debt, taking this into consideration. D. Assume there was a previous credit balance in Allowance for Doubtful Accounts of $206,770; record the year-end entry for bad debt, taking this into consideration. E. On January 24, 2019, Luxury Cruises identifies Landon Walkers account as uncollectible in the amount of $4,650. Record the entry for identification.
The following accounts receivable information pertains to Select Distributors. A. Determine the estimated uncollectible bad debt for Select Distributors in 2018 using the balance sheet aging of receivables method. B. Record the year-end 2018 adjusting journal entry for bad debt. C. Assume there was a previous debit balance in Allowance for Doubtful Accounts of $233,180; record the year-end entry for bad debt, taking this into consideration. D. Assume there was a previous credit balance in Allowance for Doubtful Accounts of $199,440; record the year-end entry for bad debt, taking this into consideration. E. On March 21, 2019, Select Distributors identifies Aida Normans account as uncollectible in the amount of $10,890. Record the entry for identification.
Funnel Direct recorded $1,345,780 in credit sales for the year and $695,455 in accounts receivable. The uncollectible percentage is 4.4% for the income statement method and 4% 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 credit balance in Allowance for Doubtful Accounts of $13,888; record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method.
The following accounts receivable information pertains to Marshall Inc. Determine the estimated uncollectible bad debt from Marshall Inc. using the balance sheet aging of receivables method, and record the year-end adjusting journal entry for bad debt.
Ink Records recorded $2,333,898 in credit sales for the year and $1,466,990 in accounts receivable. The uncollectible percentage is 3% for the income statement method and 5% 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 credit balance in Allowance for Doubtful Accounts of $20,254; record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet 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.
AGING ACCOUNTS RECEIVABLE An analysis of the accounts receivable of Johnson Company as of December 31, 20--, reveals the following: REQUIRED 1. Prepare an aging schedule as of December 31, 20--, by adding the following column to the three columns shown above: Estimated Amount Uncollectible. 2. Assuming that Allowance for Doubtful Accounts had a credit balance of 620 before adjustment, record the end-of-period adjusting entry in general journal form to enter the estimate for uncollectible accounts.

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