Question 3Dialex Watches completed the following selected transactions during 2007 & 2008:2007Dec. 31 Estimated that uncollectible-account (bad-debt) expense for the year was 1% of creditsales of $400,000 and recorded the amount as expense. Use the allowance method.Dec. 31 Made the closing entry for uncollectible-account expense.2008Jan. 17 Sold inventory to Mitch Vanez, $600, on account. Ignore cost of goods sold.June. 29 Wrote off Mitch Vanez’s account as uncollectible after repeated effort to collect fromhim.Aug. 6 Received $600 from Mitch Vanez, along with a letter apologizing for being so late.Reinstated Vanez’s account in full and recorded the cash receipt.Dec. 31 Made a compound entry to write off the following accounts as uncollectible: BernardKlaus, $1,700; Marie Monet, $1,300.Dec. 31 Estimated that uncollectible expense for the year was 1% of credit sales of $480,000,and recorded that amount as expenseDec. 31 Made the closing entry for uncollectible-account expense.Requirements:a) Open general ledger accounts for Allowance for Uncollectible Accounts and Uncollectible-AccountsExpense. Keep running balances. All accounts begin with zero balance.b) Record the transactions in the general journal and post to the two ledger accounts.c) The December 31, 2008 balance of Accounts Receivable is $139,000. Show how Accounts Receivablewould be reported on the balance sheet at that date.Mona School of Business & Management, University of the West Indies at Mona.- 5 -Question 4The June 30, 20X9, balance sheet of Ram Technologies reports the following:Accounts Receivable…………………………………. $265,000Allowance for Uncollectible Accounts (Cr)…………. 7,100At the end of each quarter, RAM estimates uncollectible-account expense to be 2% of credit sales. At theend of the year, RAM ages its accounts receivable. RAM then adjusts the balance in the Allowance forUncollectible Accounts to correspond to the aging schedule.During the second half of 20X9, RAM completed the following transactions:July 14 Made a compound entry to write off uncollectible accounts:T.J. Dooley, $700; Design Works, $2,400; and S. DeWitt, $100.Sept. 30 Recorded uncollectible-account expense equal to 2% of credit sales of $140,000Nov. 22 Wrote off accounts receivable as uncollectible:Transnet, $1,300; Webvan, $2,100; and Alpha Group, $700.Dec. 31 Recorded uncollectible-account expense based on the aging of receivables.Age of AccountsTotal1-30Days31 – 60Days61 – 90DaysOver 90Days$255,000 $120,000 $80,000 $40,000 $15,000Estimated percent (%) uncollectible 0.5% 1.0% 4% 50%Required:i) Record the transactions in the journal.ii) Open the Allowance for Uncollectible accounts, and post entries affecting that account. Keep arunning balance.iii) Show how RAM Technologies should report accounts receivable on its December 31, 20X9, balancesheet.

Question
Asked Nov 26, 2019
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Question 3
Dialex Watches completed the following selected transactions during 2007 & 2008:
2007
Dec. 31 Estimated that uncollectible-account (bad-debt) expense for the year was 1% of credit
sales of $400,000 and recorded the amount as expense. Use the allowance method.
Dec. 31 Made the closing entry for uncollectible-account expense.
2008
Jan. 17 Sold inventory to Mitch Vanez, $600, on account. Ignore cost of goods sold.
June. 29 Wrote off Mitch Vanez’s account as uncollectible after repeated effort to collect from
him.
Aug. 6 Received $600 from Mitch Vanez, along with a letter apologizing for being so late.
Reinstated Vanez’s account in full and recorded the cash receipt.
Dec. 31 Made a compound entry to write off the following accounts as uncollectible: Bernard
Klaus, $1,700; Marie Monet, $1,300.
Dec. 31 Estimated that uncollectible expense for the year was 1% of credit sales of $480,000,
and recorded that amount as expense
Dec. 31 Made the closing entry for uncollectible-account expense.
Requirements:
a) Open general ledger accounts for Allowance for Uncollectible Accounts and Uncollectible-Accounts
Expense. Keep running balances. All accounts begin with zero balance.
b) Record the transactions in the general journal and post to the two ledger accounts.
c) The December 31, 2008 balance of Accounts Receivable is $139,000. Show how Accounts Receivable
would be reported on the balance sheet at that date.
Mona School of Business & Management, University of the West Indies at Mona.

- 5 -
Question 4
The June 30, 20X9, balance sheet of Ram Technologies reports the following:
Accounts Receivable…………………………………. $265,000
Allowance for Uncollectible Accounts (Cr)…………. 7,100
At the end of each quarter, RAM estimates uncollectible-account expense to be 2% of credit sales. At the
end of the year, RAM ages its accounts receivable. RAM then adjusts the balance in the Allowance for
Uncollectible Accounts to correspond to the aging schedule.
During the second half of 20X9, RAM completed the following transactions:
July 14 Made a compound entry to write off uncollectible accounts:
T.J. Dooley, $700; Design Works, $2,400; and S. DeWitt, $100.
Sept. 30 Recorded uncollectible-account expense equal to 2% of credit sales of $140,000
Nov. 22 Wrote off accounts receivable as uncollectible:
Transnet, $1,300; Webvan, $2,100; and Alpha Group, $700.
Dec. 31 Recorded uncollectible-account expense based on the aging of receivables.
Age of Accounts
Total
1-30
Days
31 – 60
Days
61 – 90
Days
Over 90
Days
$255,000 $120,000 $80,000 $40,000 $15,000
Estimated percent (%) uncollectible 0.5% 1.0% 4% 50%
Required:
i) Record the transactions in the journal.
ii) Open the Allowance for Uncollectible accounts, and post entries affecting that account. Keep a
running balance.
iii) Show how RAM Technologies should report accounts receivable on its December 31, 20X9, balance
sheet.

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Expert Answer

Step 1

Hello. Since you have posted multiple questions and not specified which question needs to be solved, we will solve the first question for you. If you want any other specific question to be solved then please resubmit only that question or specify the question number.

 

 

(a) and (b):

Required journal entries:

6-Aug-2008 Accounts receivable
600
Post
Debit
Credit
Accounts and explanation
Date
doubtful
ref.
(S)
|(S)
Allowance
for
600
Uncollectible accounts expense
accounts
4000
31-Dec-2007
(То
the
record
ассоиnts
(400000*1%)
receivable reinns tated)
Allowance for
doubtful
4000
600
6-Aug-2008 Cash
accounts
Accounts receivable
600
record
estimated
(То
(To record the cash received)
Allowance for doubtful accounts
uncollectible expense)
31-Dec-2007 Income summary
3000
31-Dec-2008
4000
(1700+1300)
Uncollectible
асcounts
Accounts receivable
3000
4000
|еxpense
write off uncollectible
(To
the uncollectible
close
(To
ассоunts)
Uncollectible accounts expense
accounts)
31-Dec-2008
4800
(480000*1 %)
17-Jan-2008 Accounts receivable
Allowance for doubtful
600
4800
Sales revenue
асcounts
600
record
uncollectible expense)
31-Dec-2008 Income summary
estimated
(To
(To record the sale revemie)
29-Jun-2008 Allowance for doubtful accounts
600
3800
600
Accounts receivable
Uncollectible
асcounts
3800
off uncollectible
(То
write
expense
|ассounts)
(To close
the ucollectible
|ассоumts
help_outline

Image Transcriptionclose

6-Aug-2008 Accounts receivable 600 Post Debit Credit Accounts and explanation Date doubtful ref. (S) |(S) Allowance for 600 Uncollectible accounts expense accounts 4000 31-Dec-2007 (То the record ассоиnts (400000*1%) receivable reinns tated) Allowance for doubtful 4000 600 6-Aug-2008 Cash accounts Accounts receivable 600 record estimated (То (To record the cash received) Allowance for doubtful accounts uncollectible expense) 31-Dec-2007 Income summary 3000 31-Dec-2008 4000 (1700+1300) Uncollectible асcounts Accounts receivable 3000 4000 |еxpense write off uncollectible (To the uncollectible close (To ассоunts) Uncollectible accounts expense accounts) 31-Dec-2008 4800 (480000*1 %) 17-Jan-2008 Accounts receivable Allowance for doubtful 600 4800 Sales revenue асcounts 600 record uncollectible expense) 31-Dec-2008 Income summary estimated (To (To record the sale revemie) 29-Jun-2008 Allowance for doubtful accounts 600 3800 600 Accounts receivable Uncollectible асcounts 3800 off uncollectible (То write expense |ассounts) (To close the ucollectible |ассоumts

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Step 2

General ledger a...

Allowance for doubtful accounts
Credit Balance
Journal
Debit
Date
Explanation
Ref.
(S)
(S)
(S)
Uncollectible
31-Dec-2007
4000
4000
accounts expense
31-Dec-2007 Balance (ending)
Balance
(beginning)
Accounts
receivable
Accounts
receivable
Аccounts
receivable
Uncollectible
31-Dec-2008 accounts expense
(4800-1000)
Balance (ending)
(480000*1%)
4000
Uncollectible accounts expense
Credit Balance
1-Jan-2008
Debit
4000
Journal
Explanation
Date
Ref.
(S)
(S)
(S)
Allowance
doubtful accounts
31-Dec-2007 Income summary
29-Jun-2008
for
600
3400
4000
31-Dec-2007
4000
6-Aug-2008
4000
0
600
4000
Allowance
doubtful accounts
31-Dec-2008 Income summary
Balance (ending)
for
3800
3800
31-Dec-2008
31-Dec-2008
1000
3000
3800
0
0
3,800
4,800
help_outline

Image Transcriptionclose

Allowance for doubtful accounts Credit Balance Journal Debit Date Explanation Ref. (S) (S) (S) Uncollectible 31-Dec-2007 4000 4000 accounts expense 31-Dec-2007 Balance (ending) Balance (beginning) Accounts receivable Accounts receivable Аccounts receivable Uncollectible 31-Dec-2008 accounts expense (4800-1000) Balance (ending) (480000*1%) 4000 Uncollectible accounts expense Credit Balance 1-Jan-2008 Debit 4000 Journal Explanation Date Ref. (S) (S) (S) Allowance doubtful accounts 31-Dec-2007 Income summary 29-Jun-2008 for 600 3400 4000 31-Dec-2007 4000 6-Aug-2008 4000 0 600 4000 Allowance doubtful accounts 31-Dec-2008 Income summary Balance (ending) for 3800 3800 31-Dec-2008 31-Dec-2008 1000 3000 3800 0 0 3,800 4,800

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