ABE9-3 During its first year of operations, Henley Company had credit sales of $

Question

ABE9-3
During its first year of operations, Henley Company had credit sales of $3,161,069; $604,638 remained uncollected at year-end. The credit manager estimates that $37,684 of these receivables will become uncollectible.


Prepare the journal entry to record the estimated uncollectibles.

Description/Account Debit Credit





Prepare the current assets section of the balance sheet for Henley Company. Assume that in addition to the receivables it has cash of $92,267, merchandise inventory of $136,449 and prepaid expenses of $8,820.

Current assets
$
$
Less:





Total current assets

$

Explanation / Answer

Prepare the journal entry to record the estimated uncollectibles. Description/Account Debit Credit Debit: Bad debt expense 37684 Credit: Allowance for doubtful accounts 37684 To record estimated uncollectibles Prepare the current assets section of the balance sheet for Henley Company. Assume that in addition to the receivables it has cash of $92,267, merchandise inventory of $136,449 and prepaid expenses of $8,820. Current assets cash 92267 Account reivable 604,638 Less: 37,684 Net account receivable 566,954 inventory 136449 Prepaid expesnes 8820 Total current assets $804,490

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