Gross billing for merchandise Gross billing for merchandise Gross billing for me
ID: 2338208 • Letter: G
Question
Gross billing for merchandiseGross billing for merchandise
Gross billing for merchandise
Gross billing for merchandise
Gross billing for merchandise
ACCO 301 Assignment WK 4 E7-7B (L.03) Reconding Bad Debts) Rodriguez Company reports the following financial information before adjustments. Debits Credits s 500 Accounts Receivable Allowance for Doubtful Accounts Sales (all on credit) Sales Returns and Allowances 12,500 the journal entry to recod Bad Debt Expense assuming Rodriguez Company estimates bad debts at (a) 3% of net sales and (b) 8% of accounts receivable. E7-11B (Lo3) (Bad Debts-Aging) Jambo Co. includes the following account among its trade receivables for Singh Co. Singh Co. 1/1 Balance frwand 1/20 Invoice #1710 3/14 Invoice #2116 4/12 1.40011/28 2,2004/2 Cash (#1710) 2,200 2,750 Involce 82412 Invoice #3614 2250 4/10 Cash (l/1 Balance) 310 3,420 4/30 Cash (2412) Cash (#3614 and 9/20 10/17Invoice #4912 11/18 Inveice 15681 12/20Invoice 86347 1,720 4,000 10/31 1,600 12/1 part of 2412) Cash (4912) Cash (#5681) Cash (86347) 1,580 1,720 2,500 1,600 12/29 Age the balance and specify any items that apparently require particular attention at year-end. P7-3B (L05) (Bad-Debt Reporting-Aging) any year-end adjustments, SLC Corporation operates in an industry that has a high rate of bad debts. Befone the balance in SLC's Accounts Receivable account was $850,000 and the Allowance for Doubtful had a debit balance of $12,000. The year-end balance reported in the balance sheet for Allowance for Doubtful Accounts will be based on the aging schedule shown below Probability of Collection 0.98 0.92 Less than 16 days Between 16 and 30 days Between 31 and 45 days Between 46 and 60 days Between 61 and 75 days Over 75 days 175,000 0.75 0.45 0.00 40,000 a) What is the appropriate balance for Allowance for Doubtful Accounts at year-end? Ob) b) Prepare the journal entry for the year-end adjustment to the Allowance for Doubtful Accounts balance as of December 31, 2017
Explanation / Answer
Answer E7-7B. Journal Entry Date Particulars Dr. Amt. Cr. Amt. a. Bad Debt Expense 5,875.00 Allownce for Doubtful Accounts 5,875.00 (To record the Bad Debt expense) Bad Debt Expense = ($225,000 - $12,500) X 3% - $500 Bad Debt Expense = $6,375 - $500 Bad Debt Expense = $5,875 b. Bad Debt Expense 1,500.00 Allownce for Doubtful Accounts 1,500.00 (To record the Bad Debt expense) Bad Debt Expense = ($25,000 X 8%) - $500 Bad Debt Expense = $2,000 - $500 Bad Debt Expense = $1,500 Answer E7-11B. Balance 1/1 1,090.00 More than 1 Year Invoice no - 2412 - 4/12 820.00 8 months and 19 Days Invoice no - 5681 - 11/18 1,500.00 1 month and 13 Days Total 3,410.00 To investigate that the invoices issued later had been paid in full, the above amounts had not been paid by Singh Co. The beginning balance and invoice no 2412 should be of greater concern. Answer P7-3B -a. Days Account Outstanding Amount Probality of Collection Amount can be Collected Less than 16 Days 425,000.00 0.98 416,500.00 Between 16 and 30 Days 135,000.00 0.92 124,200.00 Between 31 and 45 Days 175,000.00 0.86 150,500.00 Between 46 and 60 Days 50,000.00 0.75 37,500.00 Between 61 and 75 Days 40,000.00 0.45 18,000.00 Over 75 Days 25,000.00 - - Total 850,000.00 746,700.00 Balance for Allowance for Doubtful Accounts = $850,000 - $746,700 Balance for Allowance for Doubtful Accounts = $103,300 Answer P7-3B -b. Journal Entry Date Particulars Dr. Amt. Cr. Amt. a. Bad Debt Expense 115,300.00 Allownce for Doubtful Accounts 115,300.00 (To record the Bad Debt expense) Bad Debt Expense = $103,300 + $12,000 (Debit Balance) Bad Debt Expense = $115,300
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