The Sheffield Corp. is located in midtown Madison. During the past several years, net income has been declining because of suburban shopping centers. At the end of the company’s fiscal year on November 30, 2022, the following accounts appeared in two of its trial balances. All accounts balances are normal. Unadjusted Adjusted Unadjusted Adjusted Accounts Payable $25,600 $25,600 Inventory $29,500 $29,500 Accounts Receivable 31,000 31,000 Notes payable 35,000 35,000 Accumulated Depr.—Equipment 36,000 44,500 Prepaid Insurance 10,700 2,600 Cash 26,000 26,000 Property Tax Expense 2,500 Common Stock 42,400 42,400 Property Taxes Payable 2,500 Cost of Goods Sold 511,000 511,000 Rent Expense 14,400 14,400 Dividends 9,500 9,500 Retained Earnings 61,700 61,700 Freight-Out 5,900 5,900 Salaries and Wages Expense 95,500 95,500 Equipment 147,000 147,000 Sales Commissions Expense 6,500 11,000 Depreciation Expense 8,500 Sales Commissions Payable 4,500 Insurance Expense 8,100 Sales Returns and Allowances 7,500 7,500 Interest Expense 6,000 6,000 Sales Revenue 700,000 700,000 Interest Revenue 8,500 8,500 Utilities Expense 8,700 8,700 Prepare a balance sheet. Notes payable are due in 2025. (List Current Assets in order of liquidity.)
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
The Sheffield Corp. is located in midtown Madison. During the past several years, net income has been declining because of suburban shopping centers. At the end of the company’s fiscal year on November 30, 2022, the following accounts appeared in two of its
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Unadjusted
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Adjusted
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Unadjusted
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Adjusted
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|---|---|---|---|---|---|---|---|---|---|---|
|
Accounts Payable
|
$25,600 | $25,600 |
Inventory
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$29,500 | $29,500 | |||||
|
|
31,000 | 31,000 |
Notes payable
|
35,000 | 35,000 | |||||
|
Accumulated Depr.—Equipment
|
36,000 | 44,500 |
Prepaid Insurance
|
10,700 | 2,600 | |||||
|
Cash
|
26,000 | 26,000 |
Property Tax Expense
|
2,500 | ||||||
|
Common Stock
|
42,400 | 42,400 |
Property Taxes Payable
|
2,500 | ||||||
|
Cost of Goods Sold
|
511,000 | 511,000 |
Rent Expense
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14,400 | 14,400 | |||||
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Dividends
|
9,500 | 9,500 |
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61,700 | 61,700 | |||||
|
Freight-Out
|
5,900 | 5,900 |
Salaries and Wages Expense
|
95,500 | 95,500 | |||||
|
Equipment
|
147,000 | 147,000 |
Sales Commissions Expense
|
6,500 | 11,000 | |||||
|
|
8,500 |
Sales Commissions Payable
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4,500 | |||||||
|
Insurance Expense
|
8,100 |
Sales Returns and Allowances
|
7,500 | 7,500 | ||||||
|
Interest Expense
|
6,000 | 6,000 |
Sales Revenue
|
700,000 | 700,000 | |||||
|
Interest Revenue
|
8,500 | 8,500 |
Utilities Expense
|
8,700 |
8,700
|
Prepare a
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