Financial Accounting, 8th Edition
8th Edition
ISBN: 9780078025556
Author: Robert Libby, Patricia Libby, Daniel Short
Publisher: McGraw-Hill Education
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Chapter 6, Problem 3P
Recording
Peet’s Coffee & Tea, Inc., is a specialty coffee roaster and marketer of branded fresh-roasted whole bean coffee. It recently disclosed the following information concerning the Allowance for Doubtful Accounts on its Form 10-K Annual Report submitted to the Securities and Exchange Commission
A summary of the Allowance for Doubtful Accounts is as follows (dollars in thousands)
| Allowance for Doubtful Accounts | Balance at Beginning of Period | Additions (Charges) to Expense | Write-Offs | Balance at End of Period |
| Year 1 | $128 | $ ? | $ 0 | $132 |
| Year 2 | 132 | 187 | ? | 283 |
| Year 3 | 283 | 42 | 201 | 124 |
Required:
- 1. Record summary
journal entries related to bad debts for Year 3. - 2. Supply the missing dollar amounts noted by (?) for Year 1 and Year 2
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Students have asked these similar questions
Please prepare journal entries to reflect the following items that have not been included in the unadjusted allowance for doubtful accounts
a) The trial balance before adjustment of Jason Donohoe Company reports the following balances:
Accounts receivable
Allowance for doubtful accounts
Sales (all on credit)
Sales returns and allowances
Dr.
$300,000
80,000
Date
Instructions
(a) Prepare the entry for estimated bad debts assuming the balance sheet approach is used, and
doubtful accounts are estimated to be 6% of gross accounts receivable.
DR/CR
Cr.
(b) Prepare the entry for estimated bad debts assuming that income statement approach is used
at 1% of net sales.
$ 5,000
1,700,000
(c) Assume that all the information above is the same, except that the Allowance for Doubtful
Accounts has a debit balance of $5,000 instead of a credit balance. How will this difference
affect the journal entry in part (a)?
Account
Debit
Credit
please answer within the format by providing formula the detailed workingPlease provide answer in text (Without image)Please provide answer in text (Without image)Please provide answer in text (Without image)
On December 31, a company has outstanding accounts receivable of $69,000, and it estimates that 3% of its receivables will be uncollectible.
Prepare the adjusting journal entry at year-end to record bad debts expense if the Allowance for Doubtful Accounts has a:
$1,173 credit balance before the adjustment.
$345 debit balance before the adjustment.
Chapter 6 Solutions
Financial Accounting, 8th Edition
Ch. 6 - Prob. 1QCh. 6 - What is gross profit or gross margin on sales? In...Ch. 6 - What is a credit card discount? How does it affect...Ch. 6 - Prob. 4QCh. 6 - Prob. 5QCh. 6 - Differentiate accounts receivable from notes...Ch. 6 - Which basic accounting principle is the allowance...Ch. 6 - Using the allowance method, is bad debt expense...Ch. 6 - Prob. 9QCh. 6 - Prob. 10Q
Ch. 6 - Prob. 11QCh. 6 - Prob. 12QCh. 6 - Prob. 13QCh. 6 - Prob. 14QCh. 6 - Briefly explain how the total amount of cash...Ch. 6 - Prob. 16QCh. 6 - Sales discounts with terms 2/10, n/30 mean: a. 10...Ch. 6 - Gross sales total 300,000, one-half of which were...Ch. 6 - A company has been successful in reducing the...Ch. 6 - When a company using the allowance method writes...Ch. 6 - You have determined that Company X estimates bad...Ch. 6 - Prob. 6MCQCh. 6 - Which of the following is not a step toward...Ch. 6 - When using the allowance method, as bad debt...Ch. 6 - Which of the following best describes the proper...Ch. 6 - Prob. 10MCQCh. 6 - Prob. 1MECh. 6 - Prob. 2MECh. 6 - Prob. 3MECh. 6 - Recording Bad Debts Prepare journal entries for...Ch. 6 - Prob. 5MECh. 6 - Determining the Effects of Credit Policy Changes...Ch. 6 - Prob. 7MECh. 6 - Prob. 8MECh. 6 - Prob. 1ECh. 6 - Reporting Net Sales with Credit Sales, Sales...Ch. 6 - Prob. 3ECh. 6 - Determining the Effects of Credit Sales, Sales...Ch. 6 - Prob. 5ECh. 6 - Prob. 6ECh. 6 - Prob. 7ECh. 6 - Prob. 8ECh. 6 - Prob. 9ECh. 6 - Prob. 10ECh. 6 - Prob. 11ECh. 6 - Prob. 12ECh. 6 - Prob. 13ECh. 6 - Inferring Bad Debt Write-Offs and Cash Collections...Ch. 6 - Inferring Bad Debt Write-Offs and Cash Collections...Ch. 6 - Prob. 16ECh. 6 - Prob. 17ECh. 6 - Prob. 18ECh. 6 - Prob. 19ECh. 6 - Prob. 20ECh. 6 - Interpreting tho Effects of Salos Declines and...Ch. 6 - Prob. 22ECh. 6 - Prob. 23ECh. 6 - Prob. 24ECh. 6 - Prob. 1PCh. 6 - Prob. 2PCh. 6 - Recording Bad Debts and Interpreting Disclosure of...Ch. 6 - Determining Bad Debt Expense Based on Aging...Ch. 6 - Prob. 5PCh. 6 - Prob. 6PCh. 6 - Prob. 7PCh. 6 - Prob. 8PCh. 6 - Prob. 1APCh. 6 - Prob. 2APCh. 6 - Determining Bad Debt Expense Based on Aging...Ch. 6 - Prob. 4APCh. 6 - Prob. 5APCh. 6 - Prob. 1CPCh. 6 - Prob. 2CPCh. 6 - Prob. 3CPCh. 6 - Prob. 4CPCh. 6 - Prob. 5CPCh. 6 - Prob. 6CPCh. 6 - Prob. 1CC
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