Leach Inc. experienced the following events for the first two years of its operations: Year 1: Issued $10,000 of common stock for cash. Provided $70,000 of services on account. Provided $29,000 of services and received cash. Collected $41,000 cash from accounts receivable. Paid $22,000 of salaries expense for the year. Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible. Year 2: Wrote off an uncollectible account for $730. Provided $90,000 of services on account. Provided $25,000 of services and collected cash. Collected $72,000 cash from accounts receivable. Paid $22,000 of salaries expense for the year. Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible.
Leach Inc. experienced the following events for the first two years of its operations: Year 1: Issued $10,000 of common stock for cash. Provided $70,000 of services on account. Provided $29,000 of services and received cash. Collected $41,000 cash from accounts receivable. Paid $22,000 of salaries expense for the year. Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible. Year 2: Wrote off an uncollectible account for $730. Provided $90,000 of services on account. Provided $25,000 of services and collected cash. Collected $72,000 cash from accounts receivable. Paid $22,000 of salaries expense for the year. Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible.
Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter2: Asset And Liability Valuation And Income Recognition
Section: Chapter Questions
Problem 20PC: Analyzing Transactions. Using the analytical framework, indicate the effect of the following related...
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Leach Inc. experienced the following events for the first two years of its operations:
Year 1:
- Issued $10,000 of common stock for cash.
- Provided $70,000 of services on account.
- Provided $29,000 of services and received cash.
- Collected $41,000 cash from
accounts receivable . - Paid $22,000 of salaries expense for the year.
- Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible.
Year 2:
- Wrote off an uncollectible account for $730.
- Provided $90,000 of services on account.
- Provided $25,000 of services and collected cash.
- Collected $72,000 cash from accounts receivable.
- Paid $22,000 of salaries expense for the year.
- Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 7 percent of the ending accounts receivable balance will be uncollectible.
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