At the beginning of 2009, Pental Company had the following balances: A/R = $122,000 Allowance for Uncollectible Accounts = $7,900 During 2009, their credit sales were $1,173,000 and collections on A/R were $1,150,000. The following additional transactions occurred during the year: Feb 17, wrote off XXX Account, $3.600 May 28, wrote off YYY Account, $2,400 Dec 15, wrote off ZZZ Account, $900 Dec 31, recorded bad debts expense assuming that Penman's policy is to record bad debts expense at 0.8% of credit sales (Hint: The allowance account is increased by 0.8% of credit sales regardless of write-offs.) Compute the ending balance in A/R and the allowance for uncollectible accounts. Show how Pental's Dec 31, 2009 balance sheet reports the two accounts.
At the beginning of 2009, Pental Company had the following balances: A/R = $122,000 Allowance for Uncollectible Accounts = $7,900 During 2009, their credit sales were $1,173,000 and collections on A/R were $1,150,000. The following additional transactions occurred during the year: Feb 17, wrote off XXX Account, $3.600 May 28, wrote off YYY Account, $2,400 Dec 15, wrote off ZZZ Account, $900 Dec 31, recorded bad debts expense assuming that Penman's policy is to record bad debts expense at 0.8% of credit sales (Hint: The allowance account is increased by 0.8% of credit sales regardless of write-offs.) Compute the ending balance in A/R and the allowance for uncollectible accounts. Show how Pental's Dec 31, 2009 balance sheet reports the two accounts.
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter7: Receivables And Investments
Section: Chapter Questions
Problem 7.1P: Allowance Method for Accounting for Bad Debts At the beginning of 2016, EZ Tech Companys Accounts...
Related questions
Question
At the beginning of 2009, Pental Company had the following balances:
A/R = $122,000
Allowance for Uncollectible Accounts = $7,900
During 2009, their credit sales were $1,173,000 and collections on A/R were $1,150,000.
The following additional transactions occurred during the year:
Feb 17, wrote off XXX Account, $3.600
May 28, wrote off YYY Account, $2,400
Dec 15, wrote off ZZZ Account, $900
Dec 31, recorded
Compute the ending balance in A/R and the allowance for uncollectible accounts. Show how Pental's Dec 31, 2009
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
College Accounting, Chapters 1-27
Accounting
ISBN:
9781337794756
Author:
HEINTZ, James A.
Publisher:
Cengage Learning,
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781305084087
Author:
Cathy J. Scott
Publisher:
Cengage Learning
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
College Accounting, Chapters 1-27
Accounting
ISBN:
9781337794756
Author:
HEINTZ, James A.
Publisher:
Cengage Learning,
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781305084087
Author:
Cathy J. Scott
Publisher:
Cengage Learning
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781337280570
Author:
Scott, Cathy J.
Publisher:
South-Western College Pub
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning