CONNECT PLUS-FINANCIAL & MANAGERIAL AC
7th Edition
ISBN: 2810020507384
Author: Wild
Publisher: MCG
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Textbook Question
Chapter 7, Problem 8E
Exercise 7-8 Percent of receivables method P3
Refer to the information in Exercise 7-7 to complete the following requirements.
- Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 4.5% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method.
- Prepare the
adjusting entry to recordbad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $12,000 credit. - Prepare the adjusting entry to record bad debts expenses using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $1,000 debit.
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Daley Company prepared the following aging of receivables analysis at December 31.
Days Past Due
Total
$570,000
1 to 30
$90,000
Over 90
$30,000
10%
31 to 60
61 to 90
Accounts receivable
$396,000
$36,000
$18,000
7%
1%
2 %
5%
Percent uncollectible
a. Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 4.5% of total accounts receivable to
estimate uncollectibles, instead of the aging of receivables method.
b. Prepare the adjusting entry to record Bad Debts Expense using the estimate from part a. Assume the unadjusted balance in the
Allowance for Doubtful Accounts is a $12,000 credit.
c. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the
Allowance for Doubtful Accounts is a $1,000 debit.
Complete this question by entering your answers in the tabs below.
The allowance method of estimating uncollectible accounts receivable based on an analysis of receivables shows that $844 of accounts receivable are uncollectible. Allowance for Doubtful Accounts has a debit balance of $101. The adjusting entry at the end of the year will include a credit to Allowance for Doubtful Accounts in the amount of
a.$743
b.$945
c.$844
d.$101
PROBLEM 1
A trial balance before adjustment included the following:
Credit
Debit
P120,000
Accounts receivable
Allowance for doubtful accounts
730
Sales
P510,000
Sales returns and allowances
8,000
Give journal entries assuming that the estimate of uncollectibles is determined by taking
(1) 5% of gross accounts receivable and (2) 1% of net sales
Chapter 7 Solutions
CONNECT PLUS-FINANCIAL & MANAGERIAL AC
Ch. 7 - Prob. 1MCQCh. 7 - Prob. 2MCQCh. 7 - Prob. 3MCQCh. 7 - Prob. 4MCQCh. 7 - Prob. 5MCQCh. 7 - Prob. 1DQCh. 7 - Prob. 2DQCh. 7 - Prob. 3DQCh. 7 - Prob. 4DQCh. 7 - Prob. 5DQ
Ch. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - Prob. 8DQCh. 7 - Prob. 9DQCh. 7 - Prob. 10DQCh. 7 - Prob. 1QSCh. 7 - Prob. 2QSCh. 7 - Prob. 3QSCh. 7 - QS 7-4 Distinguishing between allowance method and...Ch. 7 - QS 7-5 Allowance method for bad debts P2
Gomez...Ch. 7 - Percent of accounts receivable method P3 Warner...Ch. 7 - Prob. 7QSCh. 7 - Prob. 8QSCh. 7 - Prob. 9QSCh. 7 - Prob. 10QSCh. 7 - Prob. 11QSCh. 7 - Prob. 12QSCh. 7 - Prob. 13QSCh. 7 - Prob. 1ECh. 7 - Prob. 2ECh. 7 - Prob. 3ECh. 7 - Prob. 4ECh. 7 - Prob. 5ECh. 7 - Prob. 6ECh. 7 - Prob. 7ECh. 7 - Exercise 7-8 Percent of receivables method P3...Ch. 7 - Prob. 9ECh. 7 - Prob. 10ECh. 7 - Prob. 11ECh. 7 - Prob. 12ECh. 7 - Prob. 13ECh. 7 - Exercise 7-14 Dishonoring a note P4 Prepare...Ch. 7 - Prob. 15ECh. 7 - Prob. 16ECh. 7 - Prob. 17ECh. 7 - Prob. 1PSACh. 7 - Prob. 2PSACh. 7 - Prob. 3PSACh. 7 - Prob. 4PSACh. 7 - Prob. 5PSACh. 7 - Prob. 1PSBCh. 7 - Prob. 2PSBCh. 7 - Prob. 3PSBCh. 7 - Prob. 4PSBCh. 7 - Prob. 5PSBCh. 7 - Prob. 7SPCh. 7 - Prob. 1GLPCh. 7 - Prob. 1BTNCh. 7 - Prob. 2BTNCh. 7 - Anton Blair is the manager of a medium-size...Ch. 7 - Prob. 4BTNCh. 7 - Prob. 5BTNCh. 7 - Prob. 6BTNCh. 7 - Prob. 7BTNCh. 7 - Prob. 8BTNCh. 7 - Prob. 9BTN
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