PROBLEM#4 . . The following information pertains to Jooners on 12/31/10 Sales du
ID: 2454438 • Letter: P
Question
PROBLEM#4 . . The following information pertains to Jooners on 12/31/10 Sales during year 800,000 cash 1,400,000 credit 2,200,000 Total Accts Receivable 12/31 860,000 Allowance for Doubtful Accounts 7,000 credit balance Outstanding Accounts Not due 688,000 1-30 past 86,000 31-60 past 51,600 61-90 past 25,800 Over 90 8,600 % Uncollectible Not due 2% 1-30 past 5% 31-60 past 9% 61-90 past 15% Over 90 25% . . Prepare the following entries Adjusting entry on 12/31 after doing an aging of accounts receivable assuming the company uses the percentage of receivables approach for bad debt expense . Provide the entry to record bad debt of $1200 from Smith Company that has gone bankrupt on 1/30 . . Assume the company uses % of credit sales and determines that 2% of credit sales are uncollectible prepare the adjusting entry .
Explanation / Answer
Answer:
Adjusting journal entry:
12/31 Bad Debt Expense. .................................................................. 21724
Allowance for Doubtful Accounts ($28724 – $7000). ................................................... 21724
Answer: Provide the entry to record bad debt of $1200 from Smith Company that has gone bankrupt on 1/30
Allowance for Doubtful Accounts A/C Dr. $1200
To Accounts Receivable $1200
Answer: Assume the company uses % of credit sales and determines that 2% of credit sales are uncollectible prepare the adjusting entry .
12/31 Bad Debt Expense. .................................................................. 28000
Allowance for Doubtful Accounts (1400000*2%=$28000). ................................................... 28000
Condition Outstanding amount % Uncollectible Amount uncollectible Not due 688000 2% 13760 1-30 past 86000 5% 4300 31-60 past 51600 9% 4644 61-90 past 25800 15% 3870 over 90 8600 25% 2150 Total 860000 28724Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.