Moston Trading has the following trade receivables position:                                                        31 December 2020          31 December 2021  Trade receivables                                 111,500                                 154,100  Allowance for doubtful debts                   2%                                        3%    For the year ended 31 December 2021 one of the customers who owed Moston Trading £4,100, which is included in the trade receivables balance, has been declared bankrupt and no monies will be received from that customer.  The figure that would appear in the income statement for the year ended 31 December 2021 in respect of bad and doubtful debts is:  a) £4,100  b) £4,500  c) £2,230  d) £6,370

Estimating Bad Debts Keegan Corporation’s accounting records disclosed the following information for 2019: Cash sales                                         $850,000 Net credit sales                                 $720,000 Accounts receivable (12/31/2019)    $160,000 Allowance for doubtful accounts (12/31/2019, prior to adjustment) $1,500 (debit) Keegan wishes to examine the effect of various alternative bad debt estimation policies. Required: 1. Prepare the adjusting entry that would be required under each of the following methods: a. Bad debts are estimated at 3% of net credit sales. b. Bad debts are estimated at 7.5% of gross accounts receivable. c. An aging of accounts receivable indicates that half of the outstanding accounts will incur a 3% loss, a quar-ter will incur a 6% loss, the remaining quarter will incur a 20% loss. 2. Discuss the difference between the income statement and balance sheet approaches to estimating bad debts.

Chec Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Current assets: Receivables, net of allowance for uncollectible accounts of $39,000 $ 477,000 During 2021, credit sales were $1,795,000, cash collections from customers $1,875,000, and $44,000 in accounts receivable were written off. In addition, $3,900 was collected from a customer whose account was written off in 2020. An aging of accounts receivable at December 31, 2021, reveals the following: ces Percentage of Year-End Receivables in Group Percent Age Group 0-60 days 61-90 days 91-120 days Over 120 days Uncollectible 70% 5% 20 15 20 40 Required: 1. Prepare summary journal entries to account for the 2021 write-offs and the collection of the receivable previously written off. 2. Prepare the year-end adjusting entry for bad debts according to each of the…

Black Company reported accounts payable on December 31, 2020 P4,500,000 before any necessary year-end adjustments relating to the following transactions - On December 27, 2020, Black wrote and recorded checks to creditors totaling P2,000,000 causing an overdraftofP500,000inBlack'sbankaccountonDecember31,2020.ThechecksweremailedonJanuary 10, 2021. - OnDecember28,2020,BlackpurchasedandreceivedgoodsforP750,000,terms2/10,n/30.Blackrecords purchases and accounts payable at net amount. The invoice was recorded and paid January 3,2021. - Goods shipped F.O.B. destination on December 20, 2020 from a vendor to Black were received January 2, 2021. The invoice cost wasP325,000. On December 31, 2020, what amount should be reported as accountspayable? a. 7,575,000 b. 7,250,000 c. 7,235,000 d. 7,553,500

The following information is available for Reagan Company: Allowance for doubtful accounts at December 31, 2020 (beginning balance) $ 8,000 Accounts receivable deemed worthless and written off during 2021 9,000 As a result of a review and aging of accounts receivable it has been determined that an allowance for doubtful accounts of $5,500 is needed at December 31, 2021. What amount should Reagan record as "bad debt expense" for the year ended December 31, 2021? $4.500 $5.500 $6.500 13.500

HANDOUT PROBLEM for CURRENT LIABILITIES I. Prepare journal entries for the following chronological transactions and a. You sold merchandise on account for $250,000 on account. The products cost $110,000. Your company uses a perpetual inventory system. Your sales included a two-year warranty on the product. You spent $1,400 to repair products in part "a." which were under warranty. On December 31, 2021, you estimated that there would be an additional $8,000 of b. с. repairs on products in part "a." You estimated that $5,000 of the repairs would оссur in 2022. In 2022, you performed $4,800 of repairs on products from part "a." and $1,920 of repairs on products sold in 2022. On December 31, 2022, you estimated that repairs on products sold in 2021 would be an additional $3,500 and for products sold in 2022 would be an additional $9,000. You believe that $5,400 of the $9,000 of repairs would occur d. е. in 2023. II. Based upon the transaction above, determine the amount of current…

P 7-4 Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2020 balance sheet disclosed the following: Uncollectible accounts • LO7-5, LO7-6 Current assets: $432,000 Receivables, net of allowance for uncollectible accounts of $30,000 During 2021, credit sales were $1,750,000, cash collections from customers $1,830,000, and $35,000 in accounts receivable were written off. In addition, $3,000 was collected from a customer whose account was writ- ten off in 2020. An aging of accounts receivable at December 31, 2021, reveals the following: Percentage of Year-End Receivables in Group Percent Age Group Uncollectible 0-60 days 65% 4% 61-90 days 91-120 days Over 120 days 15 10 25 40 Required: 1. Prepare summary journal entries to account for the 2021 write-offs and the collection of the receivable previ- ously written off. 2. Prepare the year-end adjusting entry…

SCENARIO #212/31/2019: At the end of the first year of operations, Yolandi Company had $900,000 in sales and accounts receivable of $350,000.  Yolandi’s management has estimated that $9,000 in accounts receivable would be uncollectible.   For the end of 2019, after the adjusting entry for bad debts was journalized, what is the balance in the following accounts:   Bad debt expense   Allowance for doubtful accounts   For the end of 2019, what is the company’s net realizable value?   12/31/2020: During 2020, $10,000 in accounts receivable were written off. At the end of the second year of operations, Yolandi Company had $1,000,000 in sales and accounts receivable of $400,000.  Yolandi’s management has estimated that $17,000 in accounts receivable would be uncollectible.   Bad debt expense   Allowance for doubtful accounts   For the end of 2020, what is the company’s net realizable value?

Problem 7: Purple Company showed the following balances on December 31, 2019: 2,000,000 (60,000) Accounts receivable Allowance for doubtful accounts The following transactions transpired during the year 2020: a. On May 1, received a P300,000, six month, 12% interest bearing note from MN, a customer, in settlement of account. b. On June 30, Purple Company factored P400,000, of its accounts receivable to a finance company. The finance company charged a factoring fee of 5% of the accounts factored and withheld 20% of the amounts factored. c. On August 1, discounted the MN note at the bank at 15%. d. On November 1, MN defaulted on the P300,000 note. Purple Company paid the bank the total amount due plus a P12,000. protest fee and other bank charges. e. On December 31, Purple Company assigned P600,000 of its accounts receivable to a bank under a non-notification basis. The bank advanced 80% less a service fee of 5% of the accounts assigned. Purple Company signed a promissory note for the…