Financial Accounting
3rd Edition
ISBN: 9780078025549
Author: J. David Spiceland, Wayne M Thomas, Don Herrmann
Publisher: McGraw-Hill Education
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Chapter 5, Problem 5.4BE
Record the adjustment for uncollectible accounts (LO5–3)
BE5–4 At the end of the year, Mercy Cosmetics’ balance of Allowance for Uncollectible Accounts is $600 (credit) before adjustment. The balance of
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At the end of the year, Mercy Cosmetics’ balance of Allowance for Uncollectible Accounts is $600 (credit) before adjustment. The balance of Accounts Receivable is $25,000. The company estimates that 12% of accounts will not be collected over the next year. What adjustment would Mercy Cosmetics record for Allowance for Uncollectible Accounts?
8. Alladin Corporation uses the allowance method in estimating uncollectibles. At the end of the
year, Alladin Corporation estimates that 2% of its credit sales of $1,000,000 will be uncollectible.
Allowance for Doubtful Accounts has a credit balance of $1,000 before adjustment. What is the
amount of the adjusting entry?
a. $20,000
b. $21,000
c. $22,000
d. $19,000
1
Chapter 5 Solutions
Financial Accounting
Ch. 5 - When recording a credit sale, what account do we...Ch. 5 - Prob. 2RQCh. 5 - Prob. 3RQCh. 5 - Briefly explain the accounting treatment for sales...Ch. 5 - Prob. 5RQCh. 5 - Prob. 6RQCh. 5 - 7.What two purposes do firms achieve by estimating...Ch. 5 - Prob. 8RQCh. 5 - 9.What are the financial statement effects of...Ch. 5 - Prob. 10RQ
Ch. 5 - Prob. 11RQCh. 5 - Prob. 12RQCh. 5 - Prob. 13RQCh. 5 - Prob. 14RQCh. 5 - Prob. 15RQCh. 5 - Discuss the differences between the allowance...Ch. 5 - 17.Notes receivable differ from accounts...Ch. 5 - With respect to notes receivable, explain what...Ch. 5 - Prob. 19RQCh. 5 - Interest on a note receivable typically is due...Ch. 5 - Prob. 21RQCh. 5 - Prob. 22RQCh. 5 - Prob. 23RQCh. 5 - Prob. 24RQCh. 5 - Prob. 25RQCh. 5 - Prob. 5.1BECh. 5 - Prob. 5.2BECh. 5 - At the end of the first war of operations,...Ch. 5 - Record the adjustment for uncollectible accounts...Ch. 5 - Prob. 5.5BECh. 5 - Record the adjustment for uncollectible accounts...Ch. 5 - Prob. 5.7BECh. 5 - Prob. 5.8BECh. 5 - Prob. 5.9BECh. 5 - Record the write-off of uncollectible accounts...Ch. 5 - Prob. 5.11BECh. 5 - Prob. 5.12BECh. 5 - Prob. 5.13BECh. 5 - Prob. 5.14BECh. 5 - Prob. 5.15BECh. 5 - Refer to the information in BE517, but now assume...Ch. 5 - Prob. 5.1ECh. 5 - Prob. 5.2ECh. 5 - Record credit sale and cash collection with a...Ch. 5 - Prob. 5.4ECh. 5 - Prob. 5.5ECh. 5 - On April 25, Foreman Electric installs wiring in a...Ch. 5 - Prob. 5.7ECh. 5 - Prob. 5.8ECh. 5 - Prob. 5.9ECh. 5 - Prob. 5.10ECh. 5 - Prob. 5.11ECh. 5 - Consider the following transactions associated...Ch. 5 - Prob. 5.13ECh. 5 - Prob. 5.14ECh. 5 - Prob. 5.15ECh. 5 - Prob. 5.16ECh. 5 - Prob. 5.17ECh. 5 - Prob. 5.18ECh. 5 - Prob. 5.19ECh. 5 - Prob. 5.20ECh. 5 - Prob. 5.1APCh. 5 - Prob. 5.2APCh. 5 - Prob. 5.3APCh. 5 - Prob. 5.4APCh. 5 - Compare the direct write-off method to the...Ch. 5 - Prob. 5.6APCh. 5 - Prob. 5.7APCh. 5 - Prob. 5.8APCh. 5 - Assume selected financial data for Walmart and...Ch. 5 - Prob. 5.1BPCh. 5 - Prob. 5.2BPCh. 5 - Prob. 5.3BPCh. 5 - Prob. 5.4BPCh. 5 - Compare the direct write-off method to the...Ch. 5 - Prob. 5.6BPCh. 5 - Underestimating future uncollectible accounts...Ch. 5 - Prob. 5.8BPCh. 5 - Assume selected financial data for Sun Health...Ch. 5 - Prob. 5.1APCPCh. 5 - Prob. 5.2APFACh. 5 - Prob. 5.3APFACh. 5 - Prob. 5.4APCACh. 5 - Prob. 5.5APECh. 5 - Prob. 5.6APIRCh. 5 - Written Communication You have been hired as a...Ch. 5 - Earnings Management Ernie Upshaw is the...
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- 6) Brotherhood Company had the following information relating to its accounts receivable: Accounts receivable, 12/31/21 1,300,000 Credit sales for 2022 5,400,000 4,750,000 125,000 Collections from customers for 2022, excluding recovery Accounts written off 9/30/22 Collection of accounts written off in prior year (customer credit was not reestablished) Estimated uncollectible receivable per aging of receivable at 12/31/22 25,000 165,000 On December 31, 2022, the amortized cost of accounts receivable is a. 1,825,000 b. 1,800,000 c. 1,635,000 d. 1,660,000arrow_forwardChapter 5: Receivables and Sales A company reports the following amounts at 12/31/YR2 (before any year-end adjustment). Management estimates 8% of the receivables will not be collectible. The company uses the percent-of-receivables method to determine bad debt expense. Credit sales for the year 1,000,000 Accounts receiyable (A/R) 90,000 Allowance for uncollectible accounts ("AUA") 1,800 Credit Bal. Estimated percent uncollectible. 6.0% Create T accounts for A/R, AUA and Bad debt expense to help with the following questions. Accounts Receivable AUA Bad Debt Expense How much of the Accounts Receivable does management not expect to collect? What amount will the company record as bad debt expense for the YR2? What amount will be shown on the 12/31 balance sheet for Net Accounts Receivable? 1 2 3 On January 5, YR3, the company writes off an A/R they determined is uncollectible. After the write off, what is the balance in AUA? The 4 amount of the write-off is: 200 After the write off, what…arrow_forwardWhat is the Allowance for Uncollectible Accounts at December 31 of the current year after adjustments? attached in ss below thansk rgwiohwj ohwt hwarrow_forward
- 16. Q Company has the following information on December 31, 20x1 before any year-end adjustments: Net credit sales, P2,000,000 Accounts receivable, December 31, P310,000 Allowance for doubtful accounts (before any year-end adjustments), P17,000 Percentage of credit sales 2% The aging of receivables is as follows: (days outstanding, receivable balances, and % uncollectible, respectively) 0-60 days, P90,000, 2% 61-120 days, P100,000, 3% Over 120 days, P120,000, 15% Q Company uses the percentage of credit sales in determining the bad debts monthly financial statements and aging of receivables for its annual financial statements. Accounts written off during the year amounted to P38,000 and accounts recovered amounted to P9,000. As of December 31, Q determined that P20,000 accounts receivable from a certain customer included in the “61-120 days outstanding group” is 94% collectible and P10,000 account included in the “over 120 days outstanding” group is worthless and needs to be written…arrow_forward16. Q Company has the following information on December 31, 20x1 before any year-end adjustments: Net credit sales, P2,000,000 Accounts receivable, December 31, P310,000 Allowance for doubtful accounts (before any year-end adjustments), P17,000 Percentage of credit sales 2% The aging of receivables is as follows: (days outstanding, receivable balances, and % uncollectible, respectively) 0-60 days, P90,000, 2% 61-120 days, P100,000, 3% Over 120 days, P120,000, 15% Q Company uses the percentage of credit sales in determining the bad debts monthly financial statements and aging of receivables for its annual financial statements. Accounts written off during the year amounted to P38,000 and accounts recovered amounted to P9,000. As of December 31, Q determined that P20,000 accounts receivable from a certain customer included in the “61-120 days outstanding group” is 94% collectible and P10,000 account included in the “over 120 days outstanding” group is worthless and needs to be written…arrow_forward16. Q Company has the following information on December 31, 20x1 before any year-end adjustments: Net credit sales, P2,000,000 Accounts receivable, December 31, P310,000 Allowance for doubtful accounts (before any year-end adjustments), P17,000 Percentage of credit sales 2% The aging of receivables is as follows: (days outstanding, receivable balances, and % uncollectible, respectively) 0-60 days, P90,000, 2% 61-120 days, P100,000, 3% Over 120 days, P120,000, 15% Q Company uses the percentage of credit sales in determining the bad debts monthly financial statements and aging of receivables for its annual financial statements. Accounts written off during the year amounted to P38,000 and accounts recovered amounted to P9,000. As of December 31, Q determined that P20,000 accounts receivable from a certain customer included in the “61-120 days outstanding group” is 94% collectible and P10,000 account included in the “over 120 days outstanding” group is worthless and needs to be written…arrow_forward
- 1. What is the required allowance for doubtful accounts at year-end? 2. How much would be the doubtful accounts expense for the current year? Please include solutions with the answers. Thank you.arrow_forward8) Scout Company estimates the allowance for uncollectible accounts at 3% of the ending balance of accounts receivable. During 2020, Scout's credit sales and collections were P125,000 and P131,000, respectively. What was the balance of accounts receivable on January 1, 2020, if P180 in accounts receivable were written off during 2020 and if the allowance account had a balance of P750 on December 31, 2020? с. 31,180 d. 25,000 а. 5,820 b. 31,000arrow_forwardSaharrow_forward
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