The following are a series of unrelated situations. 1. Halen Company’s unadjusted trial balance at December 31, 2020, included the following accounts. Debit Credit Accounts receivable $53,000 Allowance for doubtful accounts 4,000 Net sales $1,200,000 Halen Company estimates its bad debt expense to be 7% of gross accounts receivable. Determine its bad debt expense for 2020. 2. An analysis and aging of Stuart Corp. accounts receivable at December 31, 2020, disclosed the following. Amounts estimated to be uncollectible $ 180,000 Accounts receivable 1,750,000 Allowance for doubtful accounts (per books) 125,000 What is the net amount expected to be collected of Stuart’s receivables at December 31, 2020? 3. Shore Co. provides for doubtful accounts based on 4% of gross accounts receivable, The following data are available for 2020. Credit sales during 2020 $4,400,000 Bad debt expense 57,000 Allowance for doubtful accounts 1/1/20 17,000 Collection of accounts written off in prior years (customer credit was reestablished) 8,000 Customer accounts written off as uncollectible during 2020 30,000 What is the balance in Allowance for Doubtful Accounts at December 31, 2020? 4. At the end of its first year of operations, December 31, 2020, Darden Inc. reported the following information. Accounts receivable, net of allowance for doubtful accounts $950,000 Customer accounts written off as uncollectible during 2020 24,000 Bad debt expense for 2020 84,000 What should be the balance in accounts receivable at December 31, 2020, before subtracting the allowance for doubtful accounts? 5. The following accounts were taken from Bullock Inc.’s trial balance at December 31, 2020. Debit Credit Net credit sales $750,000 Allowance for doubtful accounts $ 14,000 Accounts receivable 310,000 If doubtful accounts are 3% of accounts receivable, determine the bad debt expense to be reported for 2020. Instructions Answer the questions relating to each of the five independent situations as requested.

The following are a series of unrelated situations. 1. Halen Company’s unadjusted trial balance at December 31, 2020, included the following accounts. Debit Credit Accounts receivable $53,000 Allowance for doubtful accounts 4,000 Net sales $1,200,000 Halen Company estimates its bad debt expense to be 7% of gross accounts receivable. Determine its bad debt expense for 2020. 2. An analysis and aging of Stuart Corp. accounts receivable at December 31, 2020, disclosed the following. Amounts estimated to be uncollectible $ 180,000 Accounts receivable 1,750,000 Allowance for doubtful accounts (per books) 125,000 What is the net amount expected to be collected of Stuart’s receivables at December 31, 2020? 3. Shore Co. provides for doubtful accounts based on 4% of gross accounts receivable, The following data are available for 2020. Credit sales during 2020 $4,400,000 Bad debt expense 57,000 Allowance for doubtful accounts 1/1/20 17,000 Collection of accounts written off in prior years (customer credit was reestablished) 8,000 Customer accounts written off as uncollectible during 2020 30,000 What is the balance in Allowance for Doubtful Accounts at December 31, 2020? 4. At the end of its first year of operations, December 31, 2020, Darden Inc. reported the following information. Accounts receivable, net of allowance for doubtful accounts $950,000 Customer accounts written off as uncollectible during 2020 24,000 Bad debt expense for 2020 84,000 What should be the balance in accounts receivable at December 31, 2020, before subtracting the allowance for doubtful accounts? 5. The following accounts were taken from Bullock Inc.’s trial balance at December 31, 2020. Debit Credit Net credit sales $750,000 Allowance for doubtful accounts $ 14,000 Accounts receivable 310,000 If doubtful accounts are 3% of accounts receivable, determine the bad debt expense to be reported for 2020. Instructions Answer the questions relating to each of the five independent situations as requested.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The following are a series of unrelated situations.

1. Halen Company’s unadjusted trial balance at December 31, 2020, included the following accounts.

		Debit	Credit
Accounts receivable		$53,000
Allowance for doubtful accounts	4,000
Net sales		$1,200,000

Halen Company estimates its bad debt expense to be 7% of gross accounts receivable. Determine its bad debt expense for 2020.

2. An analysis and aging of Stuart Corp. accounts receivable at December 31, 2020, disclosed the following.

Amounts estimated to be uncollectible		$ 180,000
Accounts receivable	1,750,000
Allowance for doubtful accounts (per books)	125,000

What is the net amount expected to be collected of Stuart’s receivables at December 31, 2020?

3. Shore Co. provides for doubtful accounts based on 4% of gross accounts receivable, The following data are available for 2020.

Credit sales during 2020		$4,400,000
Bad debt expense	57,000
Allowance for doubtful accounts 1/1/20	17,000
Collection of accounts written off in prior years (customer credit was reestablished)	8,000
Customer accounts written off as uncollectible during 2020	30,000

What is the balance in Allowance for Doubtful Accounts at December 31, 2020?

4. At the end of its first year of operations, December 31, 2020, Darden Inc. reported the following information.

Accounts receivable, net of allowance for doubtful accounts		$950,000
Customer accounts written off as uncollectible during 2020	24,000
Bad debt expense for 2020	84,000

What should be the balance in accounts receivable at December 31, 2020, before subtracting the allowance for doubtful accounts?

5. The following accounts were taken from Bullock Inc.’s trial balance at December 31, 2020.

		Debit	Credit
Net credit sales			$750,000
Allowance for doubtful accounts	$ 14,000
Accounts receivable	310,000

If doubtful accounts are 3% of accounts receivable, determine the bad debt expense to be reported for 2020.

Instructions

Answer the questions relating to each of the five independent situations as requested.

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