College Accounting, Chapters 1-27
23rd Edition
ISBN: 9781337794756
Author: HEINTZ, James A.
Publisher: Cengage Learning,
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Chapter 16, Problem 4MC
To determine
Find the correct amount that should be entered for the
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a. Determine the amount of the adjusting entry for uncollectible accounts.
b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense.
c. Determine the net realizable value of accounts receivable.
After the accounts are adjusted and closed at the end of the fiscal year, Accounts Receivable has a balance of $610,084 and Allowance for Doubtful Accounts has a balance of $20,670. What is the net realizable value of the accounts receivable?
Select the correct answer.
$20,670
$610,084
$630,754
$589,414
Allowance for Doubtful Accounts has a credit balance of $800 at the end of the year (before adjustment), and an analysis of accounts in the customers ledger indicates that the estimated amount of uncollectible accounts is $16,000. Based on the estimate, which of the following adjusting entries should be made?
a.debit Allowance for Doubtful Accounts, $800; credit Bad Debt Expense, $800
b.debit Bad Debt Expense, $16,800; credit Allowance for Doubtful Accounts, $16,800
c.debit Bad Debt Expense, $800; credit Allowance for Doubtful Accounts, $800
d.debit Bad Debt Expense, $15,200; credit Allowance for Doubtful Accounts, $15,200
Chapter 16 Solutions
College Accounting, Chapters 1-27
Ch. 16 - There are two methods of accounting for...Ch. 16 - The matching principle states that debits should...Ch. 16 - Using the percentage of sales method, the balance...Ch. 16 - When an account is written off under the allowance...Ch. 16 - Each time an account is written off under the...Ch. 16 - The dollar difference between Accounts Receivable...Ch. 16 - A business has an ending balance in Accounts...Ch. 16 - A business has an ending balance in Accounts...Ch. 16 - Prob. 4MCCh. 16 - Under the allowance method, when an account is...
Ch. 16 - Prob. 1CECh. 16 - Tonis Tech Shop has total credit sales for the...Ch. 16 - Fionas Pharmacy uses the direct write-off method...Ch. 16 - Prob. 1RQCh. 16 - Prob. 2RQCh. 16 - Prob. 3RQCh. 16 - Prob. 4RQCh. 16 - Prob. 5RQCh. 16 - Prob. 6RQCh. 16 - Prob. 7RQCh. 16 - Under the allowance method, what journal entries...Ch. 16 - Prob. 9RQCh. 16 - Prob. 10RQCh. 16 - CALCULATION OF NET REALIZABLE VALUE L. R. Updike...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES Rossins...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF RECEIVABLES...Ch. 16 - COLLECTION OF ACCOUNTS WRITTEN OFFALLOWANCE METHOD...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES AND...Ch. 16 - DIRECT WRITE-OFF METHOD Maria Rivera, owner of...Ch. 16 - COLLECTION OF ACCOUNT WRITTEN OFFDIRECT WRITE-OFF...Ch. 16 - UNCOLLECTIBLE ACCOUNTSALLOWANCE METHOD Pyle...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES AND...Ch. 16 - AGING ACCOUNTS RECEIVABLE An analysis of the...Ch. 16 - DIRECT WRITE-OFF METHOD Williams Hendricks...Ch. 16 - CALCULATION OF NET REALIZABLE VALUE Mary Martin...Ch. 16 - UNCOLLECTIBLE ACCOUNTS-PERCENTAGE OF SALES Nicoles...Ch. 16 - UNCOLLECTIBLE ACCOUNTS-PERCENTAGE OF RECEIVABLES...Ch. 16 - COLLECTION OF ACCOUNT WRITTEN OFFALLOWANCE METHOD...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES AND...Ch. 16 - DIRECT WRITE-OFF METHOD Brent Mussellman, owner of...Ch. 16 - COLLECTION OF ACCOUNT WRITTEN OFFDIRECT WRITE-OFF...Ch. 16 - UNCOLLECTIBLE ACCOUNTSALLOWANCE METHOD Lewis...Ch. 16 - UNCOLLECTIBLE ACCOUNTSPERCENTAGE OF SALES AND...Ch. 16 - AGING ACCOUNTS RECEIVABLE An analysis of the...Ch. 16 - DIRECT WRITE-OFF METHOD Lee and Chen Distributors...Ch. 16 - Sam and Robert are identical twins. They opened...Ch. 16 - Martel Co. has 320,000 in Accounts Receivable on...Ch. 16 - Prob. 2CPCh. 16 - At the end of 20-3, Martel Co. had 410,000 in...
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- Using data in Exercise 9-9, assume that the allowance for doubtful accounts for Waddell Industries has a credit balance of 6,350 before adjustment on August 31. Journalize the adjusting entry for uncollectible accounts as of August 31. Waddell 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 9-8. The accounts receivable clerk for Waddell Industries prepared the following partially completed aging of receivables schedule as of the end of business on August 31: The following accounts were unintentionally omitted from the aging schedule and not included in the preceding subtotals: a. Determine the number of days past due for each of the preceding accounts as of August 31. b. Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals.arrow_forwardPrior to adjustments, Barrett Companys account balances at December 31, 2019, for Accounts Receivable and the related Allowance for Doubtful Accounts were 1,200,000 and 60,000, respectively. An aging of accounts receivable indicated that 106,000 of the December 31, 2019, receivables may be uncollectible. The net realizable value of accounts receivable at December 31, 2019, was: a. 1,034,000 b. 1,094,000 c. 1,140,000 d. 1,154,000arrow_forwardBristax 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.arrow_forward
- 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.arrow_forwardJars 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.arrow_forwardMirror Mart uses the balance sheet aging method to account for uncollectible debt on receivables. The following is the past-due category information for outstanding receivable debt for 2019. To manage earnings more efficiently, Mirror Mart decided to change past-due categories as follows. Complete the following. A. Complete each table by filling in the blanks. B. Determine the difference between total uncollectible. C. Explain how the new total uncollectible amount affects net income and accounts receivable.arrow_forward
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- Suppose the balance in the Allowance for Doubtful Accounts at the end of year is a $400 Debit balance before adjustment. The company estimates future uncollectible accounts to be $3,200. At what amount would Bad Debt Expense be reported in the current year's income statement? A. $400 B. $2,800 C. $3,600 D. $3,200arrow_forwardBlackhorse Productions, Incorporated, used the aging of accounts receivable method to estimate that its Accounts should be $19,950. The account had an unadjusted credit balance of $11,000 at that time. Required: Prepare journal entries for each of the following. (If no entry is required for a transaction/event, select in the first account field.) a. The appropriate bad debt adjustment was recorded. b. Later, an account receivable for $1,100 was determined to be uncollectible and was written off. View transaction list Journal entry worksheet 1 2 Record the end-of-period adjustment for bad debts under the aging of accounts receivable method. Note: Enter debits before credits. Transaction General Journal Debit Credit View general journal Record entry Clear entryarrow_forwardAt the end of the current year, Accounts Receivable has a balance of $3,750,000, Allowance for Doubtful Accounts has a credit balance of $22,750, and sales for the year total $48,400,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $390,000.Determine (a) the amount of the adjusting entry for uncollectible accounts; (b) the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense; and (c) the net realizable value of accounts receivable.arrow_forward
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