The following are data on three promissory notes.Determine the missing amounts. (Round answers to O decimal places, e.g. 5,275. Use 360 days for calculation.)Date of NoteTermsMaturityDatePrincipal(a)April 160 daysMay 31$842,400(b)July 230 daysAugust 1100,800(c)March 76 monthsSeptember 7129,600AnnualInterest Rate5 % $TotalInterest6୫୫252,720$50410 %$2,365,200

Step 1:The calculation of missing figures is as follows : Date of NoteTermsMaturity…

Answered: The following are data on three…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter18: The Management Of Accounts Receivable And Inventories

Section: Chapter Questions

Problem 9P

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Casebolt Company wrote off the following accounts receivable as uncollectible for the first year of its operations ending December 31: a. Journalize the write-offs under the direct write-off method. b. Journalize the write-offs under the allowance method. Also, journalize the adjusting entry for uncollectible accounts. The company recorded 5,250,000 of credit sales during the year. Based on past history and industry averages, % of credit sales are expected to be uncollectible. c. How much higher (lower) would Casebolt Companys net income have been under the direct write-off method than under the allowance method?
Presented below are the data on three promissory notes. Determine the missing amounts (round answers to 0 decimal places, e.g. 125 Assume length of year = 360 days.)Date ofNote Terms Maturity Principal Annual Interest Total Interest Date RateApril 1 60 days ? $600,000 9% ? July 2 30 days ? 90,000 ? $600March 7 6 months ? 120,000 10% ?
Maxwell Inc. analyzed its accounts receivable balances at December 31, and arrived at the aged balances listed below, along with the percentage that is estimated to be uncollectible: % Considered Age Group Balance Uncollectible 0-30 days past due $100,000 1% 31-60 days past due 18,000 3% 61-120 days past due 20,000 6% 121-180 days past due 7,000 10% Over 180 days past due 2,000 20% $147,000 The company handles credit losses using the allowance method.The credit balance of the Allowance for Doubtful Accounts is $840 on December 31, before any adjustments.a. Determine the amount of the adjustment for estimated credit losses on December 31.$Answerb. Determine the financial statement effect of a write off of Porter Company’s account on the following May 12, in the amount of $480.Use negative signs with answers, when appropriate.If a transaction increases and decreases the same Balance Sheet category, enter the increase amount in the first row and the…
Presented below are data on three promissory notes.Determine the missing amounts. (Round answers for Total Interest to 0 decimal places, e.g. 825. Round annual interest rate to 0 decimal places, e.g. 15%.) Date of Note Terms Maturity Date Principal Annual Interest Rate Total Interest (a) April 1 60 days $605,200 11 % $enter total interest in dollars for promissory note A rounded to 0 decimal places (b) July 2 30 days 94,530 enter an annual interest rate for promissory note B rounded to 0 decimal places % $630 (c) March 7 6 months 112,550 11 % $enter total interest in dollars for promissory note C rounded to 0 decimal places
The company estimates future uncollectible accounts. The company determines $16,000 of accounts receivable on January 31 are past due, and 30% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 4% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.)
67. Jansen Company prepares an account receivable aging schedule with a series of computations as follows: 10% of the total peso balance of accounts from 1-60 days past due, plus 15% of the total peso balance of accounts from 61-120 days past due and so on. How would you describe the total of the amounts determined in this series of computations? Group of answer choices It is the amount of uncollected accounts expense for the year. It is the amount of the desired credit balance of the allowance for uncollectible accounts to be reported in the year-end financial statements. When added to the total of accounts written off during the year, this new sum is the desired credit balance of the allowance account. It is the amount that should be added to the allowance for uncollectible accounts at year-end.
Based on the following data for the current year, what is the number of days' sales in receivables (rounded to one decimal place)? Assume 365 days a year. Sales on account during year $584,216 Cost of goods sold during year 170,559 Accounts receivable, beginning of year 45,497 Accounts receivable, end of year 54,226 Inventory, beginning of year 82,684 Inventory, end of year 116,504
Sprague Company uses the aging method to adjust the allowance for uncollectibleaccounts at the end of the period. At December 31, 2018, the balance of accounts receivable is$250,000 and the allowance for uncollectible accounts has a credit balance of $4,000 (beforeadjustment). An analysis of accounts receivable produced the following age groups:Current ...................................... $150,00060 days past due......................... 90,000Over 60 days past due................ 10,000$250,000Based on past experience, Sprague estimates that the percentage of accounts that will prove tobe uncollectible within the three age groups is 2% of the current balance, 8% of the 60 dayspast due balance, and 18% of the over 60 days past due balance. Based on these facts, theadjusting entry for uncollectible accounts should be made in the amount ofa. $8,000.b. $12,000.c. $17,000.d. $16,000.
For each notes receivable determine the interest revenue to be reported on the income statement for the year ended December 31. Use 360 days in your computations. date Face Rate% Term aug. 8. 45000. %7. 45days Oct. 7 62000 5 60 jan 6 28000 4 120 nov 12 43000 6 60
At the beginning of current year, ABC company reported that the allowance for doubtful account has a acredit balance of $170,000. The company uses the aging of accounts receivable as a way to estimate the allowance The following schedule was prepared: Not yet due $1,700,000 NL uncollectible1-30 days pasat due $1,200,000 5% uncollectible31-60 days past due $100,000 25% uncollectible61-90 days past due $150,000 50% uncollectibleover 90 days past due. $120,000 100% uncollectible Questions:1) What is the required allowance for doubtful accounts at year-end?2) How much would be the doubtful accounts expense for the current year?3) What is the adjusting entry for the doubtful accounts expense for the current year?4) What is the net realizable value of accounts receivable at year-end?5) What is the effect on current assets should the adjustment was not made?
SISSY Company provided the following information relating to accounts receivable for the current yearAccounts receivable on January 1 1,300,000Credit Sales 5,400,000Collections from customers, 4,750,000Accounts written off 125,000Estimated uncollectible receivables per aging 165,000What is the balance of accounts receivable before allowance for doubtful accounts on December 31?a. 1,825,000b. 1,850,000c. 1,950,000d. 1,990,000
The following table was abstracted from the trial balance of Marion company at December 31, 20x2. On January 1, 20x2, the allowance for uncollectibles had a credit balance of $12,000. During 20x2, $20,000 of accounts deemed uncollectible were written off. Historical experience indicates that 3 percent of gross sales prove uncollectible. What should the balance in the allowance for uncollectibles be after the current accrual is made? Account Name Debit Credit Credit Sales $ 500,000 Sales Discount $ 10,000 a. $ 6,700 b. $ 7,000 c. $ 14,700 d. $ 23,000

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