### Accounts Receivable and Allowance for Bad Debts Calculation**Context:**Worldwide Marble Importers has provided balances as of December 31, 2024, prior to year-end adjustments. The task involves adjusting bad debts using the aging-of-receivables method.#### Requirements:1. **Journalize the Entry for Bad Debts:** - Record the necessary journal entries to account for bad debts expense for 2024.2. **Prepare a T-account:** - Compute the ending balance of the Allowance for Bad Debts.---### Requirement 1: Journalize the Entry for Bad Debts- **Accounts Affected:** - Use the aging-of-receivables method to record the bad debts. - Record debits first, then credits.#### Journal Entry Form:- **Date:** Dec 31 - **Account Titles:** [To be filled] - **Debit:** [To be filled] - **Credit:** [To be filled] - **Explanation:** [To be selected or written]---### Requirement 2: T-account for Allowance for Bad Debts- Prepare a T-account to assess the final balance for the Allowance for Bad Debts.#### T-account structure: - **Allowance for Bad Debts** - **Debits:** [To be filled] - **Credits:** [To be filled]---### Data Table Analysis**Age of Accounts Receivable:**- **0-60 Days:** - Receivables: $74,000 - Estimated Uncollectible: 2%- **Over 60 Days:** - Receivables: $6,000 - Estimated Uncollectible: 25%- **Total Receivables:** $80,000**Allowance for Bad Debts Calculation:**- Calculate the estimated uncollectible amounts using the provided percentages and sum them to find the total allowance.**Summary Data:**- **Accounts Receivable:** $80,000- **Allowance for Bad Debts:** $2,068These tables assist with understanding how the aging method estimates bad debts, ensuring businesses account accurately for potential financial losses.

The aging-of-receivables method is employed in the entities to ascertain the amount that an entity would not be able to receive from its customers. Different time buckets show the percentage of default payments.Date Accounts Debit Credit Dec. 31 Bad Debt Expense $912 Allowance for Bad Debts $912 (To record the bad debt expense) Note: Computation of the bad debt expense: Particulars Amount ($) Estimated bad debt expense (($74,000 x 2%)+($6,000 x 25%)) $2,980 Deduct: Allowance for bad debt $(2,068) Bad debt expense $912 Allowance for Bad Debts $2,068 Beginning balance Closing balance $2,980 $912 Bad debt expense $2,980 $2,980

Business

Accounting

Worldwide Marble Importers had the following balances at December 31, 2024, before the year-end adjustments: (Click the icon to view the balances.) The aging of accounts receivable yields the following data: (Click the icon to view the accounts receivable aging schedule.) Requirements 1. Journalize Worldwide's entry to record bad debts expense for 2024 using the aging-of-receivables method. 2. Prepare a T-account to compute the ending balance of Allowance for Bad Debts. Requirement 1. Journalize Worldwide's entry to record bad debts expense for 2024 using the aging-of-receivables method. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Date Accounts Dec. 31 Requirement 2. Prepare a T-account to compute the ending balance of Allowance for Bad Debts. Allowance for Bad Debts Data table Accounts Receivable Estimated percent uncollectible S 0-60 Days 74,000 * 2% Print Debit Age of Accounts Receivable Over 60 Days 6,000 * 25% $ Done Credit Total Receivables S 80,000 Data table Accounts Receivable 80,000 Print Allowance for Bad Debts 2.068 Done

Worldwide Marble Importers had the following balances at December 31, 2024, before the year-end adjustments: (Click the icon to view the balances.) The aging of accounts receivable yields the following data: (Click the icon to view the accounts receivable aging schedule.) Requirements 1. Journalize Worldwide's entry to record bad debts expense for 2024 using the aging-of-receivables method. 2. Prepare a T-account to compute the ending balance of Allowance for Bad Debts. Requirement 1. Journalize Worldwide's entry to record bad debts expense for 2024 using the aging-of-receivables method. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Date Accounts Dec. 31 Requirement 2. Prepare a T-account to compute the ending balance of Allowance for Bad Debts. Allowance for Bad Debts Data table Accounts Receivable Estimated percent uncollectible S 0-60 Days 74,000 * 2% Print Debit Age of Accounts Receivable Over 60 Days 6,000 * 25% $ Done Credit Total Receivables S 80,000 Data table Accounts Receivable 80,000 Print Allowance for Bad Debts 2.068 Done

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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Allowance for Doubtful Accounts has a credit balance of $670 at the end of the year (before adjustment), and an analysis of accounts in the customer ledger indicates the estimated amount of uncollectible accounts should be $16,220. Based on this estimate, which of the following adjusting entries should be made? Select the correct answer. debit Allowance for Doubtful Accounts, $670; credit Bad Debt Expense, $670 debit Bad Debt Expense, $670; credit Allowance for Doubtful Accounts, $670 debit Bad Debt Expense, $15,550; credit Allowance for Doubtful Accounts, $15,550 debit Allowance for Doubtful Accounts, $16,890; credit Bad Debt Expense, $16,890
Allowance for Doubtful Accounts has a credit balance of $667 at the end of the year (before adjustment), and an analysis of accounts in the customer ledger indicates the estimated amount of uncollectible accounts should be $17,457. Based on this estimate, which of the following adjusting entries should be made? Select the correct answer. debit Bad Debt Expense, $16,790; credit Allowance for Doubtful Accounts, $16,790 debit Allowance for Doubtful Accounts, $667; credit Bad Debt Expense, $667 debit Allowance for Doubtful Accounts, $18,124; credit Bad Debt Expense, $18,124 debit Bad Debt Expense, $667; credit Allowance for Doubtful Accounts, $667
Allowance for Doubtful Accounts has a debit balance of $988 at the end of the year (before adjustment), and an analysis of accounts in the customers ledger indicates uncollectible receivables of $15,286. Which of the following entries records the proper adjusting entry for bad debt expense? Select the correct answer. a-debit Allowance for Doubtful Accounts, $15,286 credit Bad Debt Expense, $15,286 b-debit Bad Debt Expense, $16,274 credit Allowance for Doubtful Accounts, $16,274 c-debit Bad Debt Expense, $14,298 credit Allowance for Doubtful Accounts, $14,298 d-debit Bad Debt Expense, $988 credit Allowance for Doubtful Accounts, $988
A company reports the following amounts at the end of 2024 (before adjustment). Credit Sales for 2024 Accounts Receivable, December 31, 2024 Allowance for Uncollectible Accounts, December 31, 2024 Required: 1. Record the adjusting entry for uncollectible accounts using the percentage-of-receivables method. The company estimates 11% of receivables will not be collected. 2. Record the adjusting entry for uncollectible accounts using the percentage-of-credit-sales method. The company estimates 1% of credit sales will not be collected. 3. Calculate the effect on net income (before taxes) and total assets in 2024 for each method. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Record the adjusting entry for uncollectible accounts using the percentage-of-receivables method. The company estimates 11% of receivables will not be collected. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the…
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1. Couldn't understand this question, show steps thanks. Ally Company uses the aging method to adjust the allowance for uncollectible accounts at the end of the period. At December 31, 2019, the balance of accounts receivable is $210,000 and the allowance for uncollectible accounts has a credit balance of $3,000 (before adjustment). An analysis of accounts receivable produced the following age groups: Based on past experience, Ally estimates that the percentages of accounts that will prove to be uncollectible within the three groups are 2%, 8%, and 20%, respectively. Based on these facts, the adjusting entry for bad debt expense should be made in the amount of: A. $6,000 B. $9,000 C. $3,000 D. $13,000
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At the end of the current year, using the aging of receivable method, management estimated that $24,750 of the accounts receivable balance would be uncollectible. Prior to any year-end adjustments, the Allowance for Doubtful Accounts had a credit balance of $465. What adjusting entry should the company make at the end of the current year to record its estimated bad debts expense?
Coronet Suppliers uses the percent of accounts receivable method. On December 31, it has outstanding accounts receivable of $80,500, and it estimates that 3% will be uncollectible. Prepare the year-end adjusting entry to record bad debts expense under the assumption that the Allowance for Doubtful Account has: (a) a $1,369 credit balance before the adjustment. (b) a $403 debit balance before the adjustment. View transaction list Journal entry worksheet 1 2 Prepare the year-end adjusting entry to record bad debts expense under the assumption that the Allowance for Doubtful Accounts has a $1,369 credit balance before the adjustment. ansaction (a) te: Enter debits before credits. General Journal Debit Credit
Wolfpack Inc.’s trial balance indicates the following select account balances at the end of 2022 before the year-end adjustment to record bad debts: Account Debit Credit Account Receivable 700000 Allowance of Doubtful Accounts 8000 Sales Revenue 9000000 A) At the end of 2022, Wolfpack’s management estimates that 3% of its ending gross Accounts Receivable account balance will be uncollectible. How do you prepare the 12/31/22 journal entry to record bad debts expense for 2022? What is the Net Realizable Value? B) Assume that on February 4 of the following year, Wolfpack specifically writes off the receivable balance for one of its customers. The customer owes Wolfpack $4,000. Prepare the specific write-off journal entry to record this uncollectible account.