INTER. ACCOUNTING - CONNECT+ALEKS ACCESS
10th Edition
ISBN: 9781264770335
Author: SPICELAND
Publisher: MCG
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Chapter 7, Problem 7.15BE
Uncollectible accounts; solving for unknown
• LO7–5, LO7–6
A company’s year-end balance in
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Question 4
Maple Co. provides for bad debts expense at the rate of 5.72% of ending Accounts Receivable. On
Jan 1, 20X1, the Allowance for Bad Debts was $18,000. There were $16,000 of accounts written off
during the year. Credit sales for the year were $640,000. Ending Accounts Receivable was
$115,000.
What is the amount of Bad Debt Expense for the year?
Enter your response as a whole number, no commas and no dollar signs.
Your Answer:
Chapter 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…
mi.3
Chapter 7 Solutions
INTER. ACCOUNTING - CONNECT+ALEKS ACCESS
Ch. 7 - Prob. 7.1QCh. 7 - Prob. 7.2QCh. 7 - Prob. 7.3QCh. 7 - Prob. 7.4QCh. 7 - Prob. 7.5QCh. 7 - Prob. 7.6QCh. 7 - Prob. 7.7QCh. 7 - Distinguish between the gross and net methods of...Ch. 7 - Briefly explain the accounting treatment for sales...Ch. 7 - Explain the typical way companies account for...
Ch. 7 - Prob. 7.11QCh. 7 - Prob. 7.12QCh. 7 - Briefly explain the difference between the income...Ch. 7 - Prob. 7.14QCh. 7 - Is any special accounting treatment required for...Ch. 7 - Explain any possible differences between...Ch. 7 - Prob. 7.17QCh. 7 - What is meant by the discounting of a note...Ch. 7 - What are the key variables that influence a...Ch. 7 - Prob. 7.20QCh. 7 - Prob. 7.21QCh. 7 - (Based on Appendix 7B) Marshall Companies, Inc.,...Ch. 7 - Prob. 7.1BECh. 7 - Prob. 7.2BECh. 7 - Prob. 7.3BECh. 7 - Prob. 7.8BECh. 7 - Prob. 7.9BECh. 7 - Prob. 7.10BECh. 7 - Prob. 7.11BECh. 7 - Prob. 7.12BECh. 7 - Prob. 7.13BECh. 7 - Uncollectible accounts; balance sheet approach ...Ch. 7 - Uncollectible accounts; solving for unknown LO75,...Ch. 7 - Prob. 7.16BECh. 7 - Note receivable LO77 On December 1, 2018,...Ch. 7 - Long-term notes receivable LO74 On April 19,...Ch. 7 - Prob. 7.19BECh. 7 - Factoring of accounts receivable LO78 Refer to...Ch. 7 - Prob. 7.21BECh. 7 - Discounting a note LO78 On March 31, Dower...Ch. 7 - Receivables turnover LO78 Camden Hardwares credit...Ch. 7 - Prob. 7.24BECh. 7 - Prob. 7.25BECh. 7 - Prob. 7.26BECh. 7 - Prob. 7.3ECh. 7 - Prob. 7.4ECh. 7 - Prob. 7.9ECh. 7 - Prob. 7.10ECh. 7 - Prob. 7.12ECh. 7 - Prob. 7.13ECh. 7 - Prob. 7.14ECh. 7 - Prob. 7.17ECh. 7 - Prob. 7.23ECh. 7 - Factoring of accounts receivable with recourse ...Ch. 7 - Factoring of accounts receivable with recourse...Ch. 7 - Concepts; terminology LO71 through LO78 Listed...Ch. 7 - Prob. 7.29ECh. 7 - Prob. 7.36ECh. 7 - Prob. 7.1PCh. 7 - Prob. 7.2PCh. 7 - Prob. 7.3PCh. 7 - Prob. 7.5PCh. 7 - Prob. 7.1DMPCh. 7 - Real World Case 74 Sales returns; Green Mountain...Ch. 7 - Ethics Case 75 Uncollectible accounts LO75 You...Ch. 7 - Prob. 7.5DMPCh. 7 - Prob. 7.6DMPCh. 7 - Prob. 7.9DMP
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- Sh6 Please help me Solution Thankyouarrow_forwardQUESTION: 67 At the beginning of the year, Mitchum Enterprises has an allowance for doubtful accounts of $13,600. During the year, bad debts expense based on sales is $30,000. and $15,800 are written off as uncollectable. a. Record the write-off to doubtful accounts. b. Following the write-off, what is the balance of the Allowance for doubtful Accounts?arrow_forwardSolve for question 5arrow_forward
- hharrow_forwardQuestion 8 Dreadful Behaviour Ltd has credit sales of $400,000 in 2022 and a debit balance of $1,900 in the Allowance for Doubtful Accounts at year end. As of December 31, 2022, $120,000 of accounts receivable remain uncollected. The credit manager of Dangle prepared an aging schedule of accounts abnor receivable and estimates that $4,800 will prove to be uncollectible. On March 3, 2023 the credit manager authorizes a write-off of the $1,000 balance owed by D. Taylor. On April 1, 2023 Mr. Taylor pays his account in full and also pays Dangle $75 interest on his account Required (a) Prepare the adjusting entry to record the estimated uncollectible accounts expense in 2022. (b) Show the statement of financial position presentation of accounts receivable on December 31, 2022. (c) On March 3, 2023 before the write-off, assume the balance of Accounts Receivable account is $160,000 and the balance of Allowance for Doubtful Accounts is a credit of $3,000. Make the appropriate entry to record…arrow_forwardQuestion 6 Flyzopen Limited had a $900 credit balance in Allowance for Doubtful Accounts at December 31, 2022, before the current year's provision for uncollectible accounts. An aging of the accounts receivable revealed the following: Estimated Percentage Current Accounts 1-30 days past due 31-60 days past due 61-90 days past due Over 90 days past due Total Accounts Receivable $150,000 15,000 10,000 7,000 10,000 $192.000 Uncollectible 1% 2% 6% 12% 30% Required: (a) Prepare the adjusting entry on December 31, 2022, to recognize bad debts expense. (b) Assume the same facts as above except that the Allowance for Doubtful Accounts account had a $900 debit balance before the current year's provision for uncollectible accounts. Prepare the adjusting entry for the current year's provision for uncollectible accounts. 2arrow_forward
- 12.10 Doubtful debts – ageing method * LO3 On 1 June, McLean, Roberts and Associates had Accounts Receivable and Allowance for Doubtful Debts accounts as set out below. Ignore GST. Accounts Receivable 1/6 Balance 847 000 Allowance for Doubtful Debts 1/6 Balance 12 250 During June, the following transactions occurred: 1. fees earned on credit, $1 200 000 2. fees refunded, $25 000 3. accounts receivable collected, $1450 000 4. accounts written off as uncollectable, $14 740. Based on an ageing of accounts receivable on 30 June, the firm decided that the Allowance for Doubtful Debts account should have a credit balance of $13 000 on the balance sheet as at 30 June. Required (a) Prepare general journal entries to record the four transactions above and to adjust the Allowance for Doubtful Debts account. (b) Show how accounts receivable and the allowance for doubtful debts would appear on the balance sheet at 30 June. (c) On 29 July, Blundell Ltd, whose $1870 account had been written off as…arrow_forwardQw.8.arrow_forwardExercise 7-13 (Algo) Uncollectible accounts; allowance method estimating bad debts as percentage of net sales vs. direct write-off method [LO7-5, 7-6] Ervin Company uses the allowance method to account for uncollectible accounts receivable. The allowance account is adjusted based on bad debt expense as a percentage of credit sales. For 2024, net credit sales totaled $5,600,000, and the estimated bad debt percentage is 1.70%. No previously written-off accounts receivable were reinstated during 2024. The allowance for uncollectible accounts had a credit balance of $53,000 at the beginning of 2024 and $45,500, after adjusting entries, at the end of 2024. Required: 1. What is bad debt expense for 2024 as a percent of net credit sales? 2. Assume Ervin makes no other adjustment of bad debt expense during 2024. Determine the amount of accounts receivable written off during 2024. 3. If the company uses the direct write-off method, what would bad debt expense be for 2024? 1. Bad debt expense as…arrow_forward
- QUESTION 5 Information about Calbee Company is provided below: Ending Accounts Receivable: $100,000 Total Credit Sales: $250,000 Beginning Allowance for Doubtful Accounts: $15,000 (Debit) Total Write-offs: $5.000 Calbee uses the percent of receivables method. It estimates that 3% of receivables will ultimately be uncollectible. What is the amount of Bad Debt Expense? I Iarrow_forward2arrow_forwardQUESTION 28 An aging of a company's accounts receivable indicates that $5,000 is estimated to be uncollectible. If Allowance for Doubtful Accounts has a $900 credit balance, the adjustment to record bad debts for the period will require a debit to Allowance for Doubtful Accounts for $4, 100. credit to Allowance for Doubtful Accounts for $5,000. debit to Bad Debt Expense for $4,100. debit to Bad Debt Expense for $5,000. QUESTION 29arrow_forward
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