1231-60 days past due61-90 days past due91-180 days past dueOver 180 days past dueEstimate what the proper balance of the allowance for doubtful accounts should be as ofDecember 31, 2019.Selby's Bike Co. has determined that the proper balance for the Allowance for DoubtfulAccounts at December 31 is $76,475. Assume that the allowance for doubtful accounts forSelby's Bike Co. had a debit balance of $7,200 as of December 31, 2019.12Chapter 8-ReceivablesDate1Step 1: The account must be reinstated.DateGENERAL JOURNALDescriptionDate190,00060,00036,00024,000$2,060,000Reinstated a written-off Account1. Reinstate the receivable2. Receive the cash against it. Reason: For control purposes, the person who receives andrecords Cash Receipts is not the person with authority to Write-off Receivables. Likely amanager is reinstating the receivable and the Cash Receipts clerk is recording the cashreceipt.Fred sends us a check for $700Step 2: The cash received is recorded.GENERAL JOURNALDescriptionGENERAL JOURNALDescriptionPostrefPage 4PostrefDebitPostref5154080DebitDebitPageCreditPageCreditPageCredit121212 The Allowance balance is a $200 credit before adjustment. Uncollectible accounts are estimatedto be $2,000.The adjusting entry to record uncollectible accounts is:GENERAL JOURNAL1212DateChapter 8-ReceivablesNow, the adjusting entry to record uncollectible accounts is:GENERAL JOURNALDescriptiona.DescriptionIf the Allowance balance started with a $200 DEBIT balance and uncollectible accounts areestimated to be $2,000.Dateс.PostrefDebitPostrefNote: Bad Debt Expense estimate in the prior year was wrong, it was not an error. It was still agood faith estimate and the apparent violation of the matching principle is allowed under GAAP.Age IntervalNot Past Due1-30 days past dueDebitAt the end of the current year, the accounts receivable account has a debit balance of $1,400,000and sales for the year total $15,350,000. Determine the amount of the adjustment needed.PageCreditThe allowance account before adjustment has a debit balance of $23,000. Bad debtexpense is estimated at 4 of 1% of sales.BalancePageCredit$1,250,000500,000b.The allowance account before adjustment has a debit balance of $23,000. An aging of theaccounts in the customer ledger indicates estimated doubtful accounts of $125,000.The allowance account before adjustment has a credit balance of $14,500. Bad debtexpense is estimated at 2 of 1% of sales.Page 3d.The allowance account before adjustment has a credit balance of $14,500. An aging ofthe accounts in the customer ledger indicates estimated doubtful accounts of $180,000.Selby's Bike Co. is a wholesaler motorcycle supplies. An aging of the company's accountsreceivable on December 31, 2019, and a historical analysis of the percentage of uncollectibleaccounts in each age category are as follows:% Uncollectible12120.75%3

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Chapter 8 -Receivables 31-60 days past due 61-90 days past due 91-180 days past due Over 180 days past due 2 190,000 60,000 36,000 24,000 $2,060,000 Estimate what the proper balance of the allowance for doubtful accounts should be as of December 31, 2019. Date Selby's Bike Co. has determined that the proper balance for the Allowance for Doubtful Accounts at December 31 is $76,475. Assume that the allowance for doubtful accounts for Selby's Bike Co. had a debit balance of $7,200 as of December 31, 2019. а GENERAL JOURNAL Description 5 15 40 80 Post ref Debit Page Credit 12

Chapter 8 -Receivables 31-60 days past due 61-90 days past due 91-180 days past due Over 180 days past due 2 190,000 60,000 36,000 24,000 $2,060,000 Estimate what the proper balance of the allowance for doubtful accounts should be as of December 31, 2019. Date Selby's Bike Co. has determined that the proper balance for the Allowance for Doubtful Accounts at December 31 is $76,475. Assume that the allowance for doubtful accounts for Selby's Bike Co. had a debit balance of $7,200 as of December 31, 2019. а GENERAL JOURNAL Description 5 15 40 80 Post ref Debit Page Credit 12

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter9: Receivables

Section: Chapter Questions

Problem 12E: Using the data in Exercise 9-11, assume that the allowance for doubtful accounts for Selbys Bike Co....

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Using data in Exercise 9-9, assume that the allowance for doubtful accounts for Waddell Industries has a credit balance of 6,350 before adjustment on August 31. Journalize the adjusting entry for uncollectible accounts as of August 31. Waddell Industries has a past history of uncollectible accounts, as follows. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule you completed in Exercise 9-8. The accounts receivable clerk for Waddell Industries prepared the following partially completed aging of receivables schedule as of the end of business on August 31: The following accounts were unintentionally omitted from the aging schedule and not included in the preceding subtotals: a. Determine the number of days past due for each of the preceding accounts as of August 31. b. Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals.
Using the data in Exercise 9-11, assume that the allowance for doubtful accounts for Selbys Bike Co. had a debit balance of 7,200 as of December 31, 2016. Journalize the adjusting entry for uncollectible accounts as of December 31, 2016. Journalize the adjusting entry for uncollectible accounts as of December 31, 2016. Selbys Bike Co. is a wholesaler of motorcycle supplies. An aging of the companys accounts receivable on December 31, 2016, and a historical analysis of the percentage of uncollectible accounts in each age category are as follows: Estimate what the proper balance of the allowance for doubtful accounts should be as of December 31, 2016.
UNCOLLECTIBLE ACCOUNTS-PERCENTAGE OF RECEIVABLES Charlies Chevy Sales and Service estimates the amount of uncollectible accounts using the percentage of receivables method. Based on aging the accounts, it is estimated that 3,935 will not be collected. Record the end-of-period adjusting entry on December 31, in general journal form, for the estimated uncollectible accounts. Assume the following independent conditions existed prior to the adjustment: 1. Allowance for Doubtful Accounts has a credit balance of 245. 2. Allowance for Doubtful Accounts has a debit balance of 560.
At the beginning of 2020, Tanham Company discovered the following errors made in the preceding 2 years: Reported net income was 27,000 in 2018 and 35,000 in 2019. The allowance for doubtful accounts had a zero balance at the beginning of 2018. No accounts were written off during 2018 or 2019. Ignore income taxes. Required: 1. What is the correct net income for 2018 and 2019? 2. Prepare the adjusting journal entry in 2020 to correct the errors.