This is one question with multiple parts, please help. Problem 8-1A At December

Question

This is one question with multiple parts, please help.

Problem 8-1A At December 31, 2016, House Co. reported the following information on its balance sheet. Accounts receivable Less: Allowance for doubtful accounts $950,000 78,000 During 2017, the company had the following transactions related to receivables. 1. 2. 3. 4. 5. Sales on account Sales returns and allowances Collections of accounts receivable Write-offs of accounts receivable deemed uncollectible Recovery of bad debts previously written off as uncollectible $3,650,000 48,000 2,800,000 88,000 27,000

Explanation / Answer

No. Account titles and explanations Debit Credit 1) Accounts receivable 3,650,000 sale 3,650,000 2) Sales return and allowance 48,000 Accounts receivable 48,000 3) Cash 2,800,000 Accounts receivable 2,800,000 4) Allowance for doubtful accounts 88,000 Account receivable 88,000 5) Accounts receivable 27,000 Allowance for doubtful accounts 27,000 cash 27,000 Accounts receivable 27,000 T-Account Account receivable BB 950,000 2) 48,000 1) 3,650,000 3) 2,800,000 5) 27,000 4) 88,000 5) 27,000 End bal 1,664,000 Allowance for Doubtful accounts 4) 88,000 BB 78,000 5) 27,000 end bal 17,000 Account titles and explanations Debit Credit Bad debts expesne 98000 Allowance for Doubtful accounts 98,000 (115000-17000) opening ending Accounts receivable 950,000 1,664,000 less allowance for doubtful -78000 -115000 net realizable value 872,000 1,549,000 Average account receivable (872000+1549000)/2 436000 Accounts receivable turnover = sales/account receivable turnover 3,602,000/436000 8.26

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