Assume that the percentage of sales method was used instead by the company and that on December 31st, 2010 5% of 2010 ‘s credit sales are estimated to be uncollectible. Assume Sales for 2010 were 520,000 (60% relates to cash sales)You are now required to:Determine the amount to be charged to the uncollectible expense account.(1) Prepare the Allowance for uncollectible account for 2010, using this method(ii) Prepare the balance sheet extract to show the net realizable value of the Accounts Receivable as at December 31 2010 Slow Running Shoes uses the Aging of receivables method to account foruncollectible accounts.The balance in the Allowance for uncollectible account as at Jan 1st, 2010 was $10,500(credit)The balance in the Accounts Receivable account as at Jan 1st, 201o was $133,000.The company completed the following transactions during 2010 and 2011:2010June 10thWrote off the balance of $600 from MannyMiller's account as uncollectibleRe-instated the account of Betty Lou andrecorded the collection of $1200 as paymentin full for her account which had been writtenoff earlierRecorded the uncollectible account expensebased on the aging schedule. The scheduleshowed that $14,100 of accounts receivablewas estimated as uncollectibleSeptember 15thDecember 31stDecember 31stMade the closing entry for the uncollectibleexpense account2011Sold inventory to Jack Frost, $1100, onJan 17accountWrote off as uncollectible the accounts ofBarry Semper, $1,500; Maria Jesus $1,400and Rory Paul $200Received 40% of the amount owed by JackAugust 15September 26Frost and wrote off the remainder asuncollectibleReceived 20% of the funds owed from MariaJesus as part payment of her account whichhad been written off earlier as uncollectibleThe Aging schedule showed an estimated$7500 as uncollectibleOctober 16December 314. Assume that the percentage of sales method was used instead by the company and that onDecember 31st, 2010 5% of 2010 's credit sales are estimated to be uncollectible. AssumeSales for 2010 were 520,000 (60% relates to cash sales)You are now required to:a. Determine the amount to be charged to the uncollectible expense account.b. (1) Prepare the Allowance for uncollectible account for 2010, using this method(ii) Prepare the balance sheet extract to show the net realizable value of the AccountsReceivable as at December 31 2010

a) Compute the uncollectible expense to be charged to the uncollectible expense account:…

Answered: Assume that the percentage of sales…

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter8: Revenue Recognition, Receivables, And Advances From Customers

Section: Chapter Questions

Problem 45P

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Assume that the percentage of sales method was used instead by the company and that on December 31^st, 2010 5% of 2010 ‘s credit sales are estimated to be uncollectible. Assume Sales for 2010 were 520,000 (60% relates to cash sales)

You are now required to:

Determine the amount to be charged to the uncollectible expense account.
(1) Prepare the Allowance for uncollectible account for 2010, using this method

(ii) Prepare the balance sheet extract to show the net realizable value of the Accounts Receivable as at December 31 2010

Slow Running Shoes uses the Aging of receivables method to account for
uncollectible accounts.
The balance in the Allowance for uncollectible account as at Jan 1st, 2010 was $10,500
(credit)
The balance in the Accounts Receivable account as at Jan 1st, 201o was $133,000.
The company completed the following transactions during 2010 and 2011:
2010
June 10th
Wrote off the balance of $600 from Manny
Miller's account as uncollectible
Re-instated the account of Betty Lou and
recorded the collection of $1200 as payment
in full for her account which had been written
off earlier
Recorded the uncollectible account expense
based on the aging schedule. The schedule
showed that $14,100 of accounts receivable
was estimated as uncollectible
September 15th
December 31st
December 31st
Made the closing entry for the uncollectible
expense account
2011
Sold inventory to Jack Frost, $1100, on
Jan 17
account
Wrote off as uncollectible the accounts of
Barry Semper, $1,500; Maria Jesus $1,400
and Rory Paul $200
Received 40% of the amount owed by Jack
August 15
September 26
Frost and wrote off the remainder as
uncollectible
Received 20% of the funds owed from Maria
Jesus as part payment of her account which
had been written off earlier as uncollectible
The Aging schedule showed an estimated
$7500 as uncollectible
October 16
December 31
4. Assume that the percentage of sales method was used instead by the company and that on
December 31st, 2010 5% of 2010 's credit sales are estimated to be uncollectible. Assume
Sales for 2010 were 520,000 (60% relates to cash sales)
You are now required to:
a. Determine the amount to be charged to the uncollectible expense account.
b. (1) Prepare the Allowance for uncollectible account for 2010, using this method
(ii) Prepare the balance sheet extract to show the net realizable value of the Accounts
Receivable as at December 31 2010

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

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