Vulcan Service Company experienced the following transactions for Year 1, its first year of operations: 1. Provided $80,000 of services on account. 2. Collected $48,000 cash from accounts receivable. 3. Paid $32,000 of salaries expense for the year. 4. Adjusted the accounts using the following information from an accounts receivable aging schedule: Number of Days Past Due Current 0 to 30 31 to 60 61 to 90 Over 90 days Amount $23,680 1,600 2,240 1,920 2,560 Percent Likely to Be Uncollectible 0.01 0.05 0.10 0.30 0.50 Allowance Balance Required a. Record the given transactions in general journal form and post to T-accounts. b. Prepare the income statement for Vulcan Service Company for Year 1. c. What is the net realizable value of the accounts receivable at December 31, Year 1?

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Vulcan Service Company experienced the following transactions for Year 1, its first year of operations:
1. Provided $80,000 of services on account.
2. Collected $48,000 cash from accounts receivable.
3. Paid $32,000 of salaries expense for the year.
4. Adjusted the accounts using the following information from an accounts receivable aging schedule:
Number of Days Past Due
Current
0 to 30
31 to 60
61 to 90
Over 90 days
Amount
$23,680
1,600
2,240
1,920
2,560
Percent Likely to Be
Uncollectible
0.01
0.05
0.10
0.30
0.50
Allowance
Balance
Required
a. Record the given transactions in general journal form and post to T-accounts.
b. Prepare the income statement for Vulcan Service Company for Year 1.
c. What is the net realizable value of the accounts receivable at December 31, Year 1?
Transcribed Image Text:Vulcan Service Company experienced the following transactions for Year 1, its first year of operations: 1. Provided $80,000 of services on account. 2. Collected $48,000 cash from accounts receivable. 3. Paid $32,000 of salaries expense for the year. 4. Adjusted the accounts using the following information from an accounts receivable aging schedule: Number of Days Past Due Current 0 to 30 31 to 60 61 to 90 Over 90 days Amount $23,680 1,600 2,240 1,920 2,560 Percent Likely to Be Uncollectible 0.01 0.05 0.10 0.30 0.50 Allowance Balance Required a. Record the given transactions in general journal form and post to T-accounts. b. Prepare the income statement for Vulcan Service Company for Year 1. c. What is the net realizable value of the accounts receivable at December 31, Year 1?
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