QUESTION 1 Information about Calbee Company is provided below: Ending Accounts Receivable: $100,000 Total Credit Sales: $250,000 Beginning Allowance for Doubtful Accounts: $15,000 (Credit) Total Write-offs: $5,000 Calbee uses the percent of credit sales method. It estimates that 3% of credit sales will ultimately be uncollectible. What is the ending balance in the Allowance for Doubtful Accou

QUESTION 1 Information about Calbee Company is provided below: Ending Accounts Receivable: $100,000 Total Credit Sales: $250,000 Beginning Allowance for Doubtful Accounts: $15,000 (Credit) Total Write-offs: $5,000 Calbee uses the percent of credit sales method. It estimates that 3% of credit sales will ultimately be uncollectible. What is the ending balance in the Allowance for Doubtful Accou

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter6: Cash And Receivables

Section: Chapter Questions

Problem 7RE: McKinney Co. estimates its uncollectible accounts as a percentage of credit sales. McKinney made...

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Bad Debt Expense: Percentage of Credit Sales Method Gilmore Electronics had the following data for a recent year: Cash sales $135,000 Credit sales 512,000 Accounts receivable determined to be uncollectible 9,650 The firms estimated rate for bad debts is 2.2% of credit sales. Required: 1. Prepare the journal entry to write off the uncollectible accounts. 2. Prepare the journal entry to record the estimate of bad debt expense. 3. If Gilmore had written off $3,000 of receivables as uncollectible during the year, how much would bad debt expense reported on the income statement have changed? 4. CONCEPTUAL CONNECTION If Gilmores estimate of bad debts is correct (2.2% of credit sales) and the gross margin is 20%, by how much did Gilmores income from operations increase assuming $150,000 of the sales would have been lost if credit sales were not offered?
UNCOLLECTIBLE ACCOUNTS-PERCENTAGE OF SALES Nicoles Neckties has total credit sales for the year of 380,000 and estimates that 2% of its credit sales will be uncollectible. Record the end-of-period adjusting entry on December 31, in general journal form, for the estimated bad debt expense. Assume the following independent conditions existed prior to the adjustment: 1. Allowance for Doubtful Accounts has a credit balance of 430. 2. Allowance for Doubtful Accounts has a debit balance of 295.
Calculate the allowance for doubtful accounts using the percentage of sales method: Net Credit Sales $1,000,000 Estimate for Credit Losses 3% of Credit Sales Beginning Allowance for Doubtful Accounts Beginning Balance $20,000 3,000 600 588 29,400 30,000
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 I
A company has $235,000 in credit sales. The company uses the allowance method to account for uncollectible accounts. The Allowance for Doubtful Accounts now has a $7,590 credit balance. If the company estimates 5% of credit sales will be uncollectible, what will be the amount of the journal entry to record estimated uncollectible accounts? O A. $4,160 O B. $7,590 O C. $19,340 O D. $11,750
Please answer with good presentation Lauren Sign Company uses the allowance method in accounting for uncollectible accounts. Past experience indicates that 3% of net credit sales will eventually be uncollectible. Selected account balances at December 31, 2020, and December 31, 2021, appear below 12/31/2020 12/31/2021 Net Credit Sales 800,000 1,000,000 Accounts Receivable 150,000 200,000 Allowance for Doubtful Accounts 12,000 ? Bad Debt Expense 18,000 ? What is the balance of Allowance for Doubtful Accounts at December 31, 2021? (Hint: you might want to create a t-account)
The following information concerns Complex, Inc.: Accounts receivable, 12/31/X7 $56,000 Credit sales during X7 $189,000 Allowance for doubtful accounts, 12/31/X7 $1,500 credit Bad debt expense is determined using the percentage of sales method. The company believes that 4% of sales will never be collected. What would be the balance in allowance for doubtful accounts after the adjusting entry? Select one: O a. $9,060 O b. $7,560 O c. $1,500 O d. $6,060 Oe. $2,240
Which of the following would be the correct journal entry to record the allowance for doubtful accounts under the percentage of sales method if, Net Credit Sales are $500,000 and management estimates the credit losses to be 2% of net credit sales? Debit Accounts Receivable 10,000 Credit Allowance for Doubtful Accounts 10,000 Debit Allowance for Doubtful Accounts 10,000 Credit Accounts Receivable 10,000 Debit Allowance for Doubtful Accounts 10,000 Credit Bad Debts Expense 10,000 Debit Bad Debts Expense 10,000 Credit Allowance for Doubtful Accounts 10,000
Gu Company provided the following from the unadjusted trial balance at year end Debit Credit Accounts Receivable 5,000,000 Allowance for Doubtful Accounts 40,000 Net Credit Sales 20,000,000 The entity estimated that 3% of the gross accounts receivable will become uncollectible What is the required allowance for doubtful accounts at year end? a. 150,000 b. 110,000 c. 190,000 d. 40,000
Based on the following information: Sales returns and allowances (credit sales) $20,000 Cash sales $1,200,000 Unadjusted balance in Allowance for Doubtful Accounts 1,000 credit Credit sales 2,150,000 If bad debts are estimated to be 2% of net credit sales, in the adjusting entry to recognize uncollectible accounts, the debit to expense will be for a. $52,000 b. $51,000 c. $50,000 d. $42,600
Castaway Company provided the following information for the current year: Allowance for doubtful accounts-January 1 200,000 9,500,000 Sales-all on credit Sales discount 1,000,000 Sales return and allowances 500,000 100,000 50,000 Accounts written off as uncollectible Recovery of accounts written off The entity recorded doubtful accounts expense at the rate of 5% of net credit sales. What amount should be reported as allowance for doubtful accounts on December 31?
Accounts receivable Allowance for uncollectible accounts Net Sales $362,000 debit 570 debit 807,000 credit All sales are made on credit. Based on past experience, the company estimates 0.3% of net credit sales to be uncollectible. What adjusting entry should the company make at the end of the current year to record its estimated bad debts expense? Multiple Choice Debit Bad Debts Expense $1,656; credit Allowance for Doubtful Accounts $1,656. Debit Bad Debts Expense $2,421; credit Allowance for Doubtful Accounts $2,421. Debit Bad Debts Expense $1,086; credit Allowance for Doubtful Accounts $1,086. Debit Bad Debts Expense $2,991; credit Allowance for Doubtful Accounts $2,991.