Financial Accounting
9th Edition
ISBN: 9781259738692
Author: Libby
Publisher: MCG
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Chapter 4, Problem 8MCQ
To determine
Ascertain the
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The ledger of Metlock, Inc. at the end of the current year shows Accounts Receivable $85,700; Credit Sales $845,580; and Sales Returns and Allowances $42,390.
(a)
If Metlock, Inc. uses the direct write-off method to account for uncollectible accounts, journalize the adjusting entry at December 31, assuming Metlock, Inc. determines that Matisse’s $883 balance is uncollectible.
(b)
If Allowance for Doubtful Accounts has a credit balance of $1,191 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 9% of accounts receivable.
(c)
If Allowance for Doubtful Accounts has a debit balance of $450 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 8% of accounts receivable.
(Credit account titles are automatically indented when amount is entered. Do not indent manually.)
No.
Account Titles and Explanation
Debit
Credit
(a)
enter an account title
enter a…
The ledger of Pina Colada Corp. at the end of the current year shows Accounts Receivable $108,000; Sales Revenue
$832,000; and Sales Returns and Allowances $18,100.
If Pina Colada uses the direct write-off method to account for uncollectible accounts, journalize the adjusting entry at
(a)
December 31, assuming Pina Colada determines that L. Dole's $1,000 balance is uncollectible.
If Allowance for Doubtful Accounts has a credit balance of $2,000 in the trial balance, journalize the adjusting entry at
(b)
December 31, assuming bad debts are expected to be 11% of accounts receivable.
If Allowance for Doubtful Accounts has a debit balance of $199 in the trial balance, journalize the adjusting entry
(c)
December 31, assuming bad debts are expected to be 8% of accounts receivable.
A company has the following December 31 year-end unadjusted balances: Allowance for Sales Discounts, $0; and Accounts
Receivable, $11,200. Of the $11,200 of receivables, $2,600 are within a 3% discount period, and the company expects buyers to take
$78 in future discounts arising from this period's sales.
Required:
1. Prepare the December 31 year-end adjusting journal entry for future sales discounts.
Chapter 4 Solutions
Financial Accounting
Ch. 4 - What is the purpose of recording adjusting...Ch. 4 - List the four types of adjusting entries, and give...Ch. 4 - What is a contra-asset? Give an example of one.Ch. 4 - Explain how the financial statements relate to...Ch. 4 - What is the equation for each of the following...Ch. 4 - Explain the effect of adjusting entries on cash.Ch. 4 - How is earnings per share computed and...Ch. 4 - Prob. 8QCh. 4 - What are the purposes for closing the books?Ch. 4 - Differentiate among (a) permanent, (b) temporary,...
Ch. 4 - Explain why the income statement accounts are...Ch. 4 - Prob. 12QCh. 4 - Which of the following accounts would not appear...Ch. 4 - Which account is least likely to appear in an...Ch. 4 - Prob. 3MCQCh. 4 - On June 1, 2016, Oakcrest Company signed a...Ch. 4 - Prob. 5MCQCh. 4 - An adjusted trial balance a. Shows the ending...Ch. 4 - JJ Company owns a building. Which of the following...Ch. 4 - Prob. 8MCQCh. 4 - Prob. 9MCQCh. 4 - If a company is successful in acquiring several...Ch. 4 - Preparing a Trial Balance Hagadorn Company has the...Ch. 4 - Matching Definitions with Terms Match each...Ch. 4 - Matching Definitions with Terms Match each...Ch. 4 - Recording Adjusting Entries (Deferred Accounts) In...Ch. 4 - Determining Financial Statement Effects of...Ch. 4 - Recording Adjusting Entries (Accrued Accounts) In...Ch. 4 - Prob. 4.7MECh. 4 - Reporting an Income Statement with Earnings per...Ch. 4 - Prob. 4.9MECh. 4 - Reporting an Income Statement with Earnings per...Ch. 4 - Prob. 4.11MECh. 4 - Recording Closing Entries Refer to the adjusted...Ch. 4 - Prob. 4.1ECh. 4 - Prob. 4.2ECh. 4 - Recording Adjusting Entries Diane Company...Ch. 4 - Prob. 4.4ECh. 4 - Prob. 4.5ECh. 4 - Recording Adjusting Entries and Reporting Balances...Ch. 4 - Determining Financial Statement Effects of...Ch. 4 - Recording Seven Typical Adjusting Entries...Ch. 4 - Prob. 4.9ECh. 4 - Determining Financial Statement Effects of Seven...Ch. 4 - Determining Financial Statement Effects of Seven...Ch. 4 - Recording Transactions Including Adjusting and...Ch. 4 - Prob. 4.13ECh. 4 - Determining Financial Statement Effects of...Ch. 4 - Inferring Transactions Deere Company is the...Ch. 4 - Analyzing the Effects of Errors on Financial...Ch. 4 - Prob. 4.17ECh. 4 - Recording the Effects of Adjusting Entries and...Ch. 4 - Reporting a Correct Income Statement with Earnings...Ch. 4 - Recording Four Adjusting Entries and Completing...Ch. 4 - Prob. 4.21ECh. 4 - Recording Four Adjusting Entries and Completing...Ch. 4 - Prob. 4.1PCh. 4 - Prob. 4.2PCh. 4 - Prob. 4.3PCh. 4 - Prob. 4.4PCh. 4 - Prob. 4.5PCh. 4 - Prob. 4.6PCh. 4 - Prob. 4.7PCh. 4 - Prob. 4.1APCh. 4 - Prob. 4.2APCh. 4 - Prob. 4.3APCh. 4 - Prob. 4.4APCh. 4 - Determining Financial Statement Effects of...Ch. 4 - Prob. 4.6APCh. 4 - Prob. 4.7APCh. 4 - Prob. 4.1CONCh. 4 - Recording Transactions (Including Adjusting and...Ch. 4 - Recording Transactions (Including Adjusting and...Ch. 4 - Finding Financial Information Refer to the...Ch. 4 - Finding Financial Information Refer to the...Ch. 4 - Comparing Companies within an Industry and Over...Ch. 4 - Prob. 4.4CPCh. 4 - Prob. 4.5CPCh. 4 - Prob. 4.6CPCh. 4 - Prob. 4.7CPCh. 4 - Prob. 4.8CPCh. 4 - Prob. 4.9CP
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- Oswego Clay Pipe Company sold $45,800 of pipe to Southeast Water District 45 on April 12 of the current year with terms 2/15./60. Oswego uses the gross method of accounting for sales discounts. What entry would Oswego make on June 10, assuming the customer made the correct payment on that date?arrow_forwardOn December 1, 2019, Lynch Incorporated sold $17,000 of merchandise with terms 2/10, n/EOM. On December 11, 2019, collections were made on sales originally billed for $10,000, and on December 31, 2019, additional collections on sales originally billed for $6,000 were received. Required: 1. Prepare the journal entries to record the sale, collections, and any required year-end adjustments assuming that Lynch records accounts receivable and sales at (a) the gross price and (b) the net price. 2. Next Level Assume that Lynch’s customer does not have the available cash to pay Lynch within the discount period. How much interest should the customer be willing to pay for a loan to permit them to take advantage of the discount period (assume no additional costs to the loan)? 3. Next Level Explain why Lynch’s granting of cash (sales) discounts may improve cash flow. CHART OF ACCOUNTS Lynch Incorporated General Ledger ASSETS 111 Cash 121 Accounts Receivable…arrow_forwardThe ledger of Pina Colada Corp. at the end of the current year shows Accounts Receivable $108,000; Sales Revenue $832,000; and Sales Returns and Allowances $18,100. (a) If Pina Colada uses the direct write-off method to account for uncollectible accounts, journalize the adjusting entry at December 31, assuming Pina Colada determines that L. Dole’s $1,000 balance is uncollectible. (b) If Allowance for Doubtful Accounts has a credit balance of $2,000 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 11% of accounts receivable. (c) If Allowance for Doubtful Accounts has a debit balance of $199 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 8% of accounts receivable. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit (a) enter an account title…arrow_forward
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