Obj.4 fiscal year PR 8-1B Allowance method entries 3. $2,290,000 The following t
ID: 2579427 • Letter: O
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Obj.4 fiscal year PR 8-1B Allowance method entries 3. $2,290,000 The following transactions were completed by Wild Trout Gallery during the current fis ended December 31: 19. Reinstated the account of Arlene Gurley, which had been written off in the preceding year as uncollectible. Journalized the receipt of $2660 cash in full payment of Arlene's account. Wrote off the $12,750 balance owed by Premier GS Co, which is bankrupt. remainder as uncollectible. Recorded the receipt of $4,000 cash in full payment. Lake Furniture, $11,400; Melinda Shryer, $1,200. uncollectible. Journalized the adjusting entry. Jan. GENERAL LEDGER Apr. 3. July 16. Received 25% of the$22,000 balance owed by Hayden Co., a bankrupt business, and wrote off the Nov. 23. Reinstated the account of Harry Car, which had been written off two years earlier as uncollec Dec. 31. Wrote off the following accounts as uncollectible (compound entry: Cavey Co, $3,300, Fogle Co, $58./0 31. Based on an analysis of the $2,350,000 of accounts receivable, it was estimated that $60,000 will be Instructions 1. Record the January 1 credit balance of $50,000 in a T account for Allowance for Doubtful Accounts 2. Journalize the transactions. Post each entry that affects the following selected T accounts and determine the new balances: Allowance for Doubtful Accounts Bad Debt Expense 3. Determine the expected net realizable value of the accounts receivable as of December 31. 4. Assuming that instead of basing the provision for uncollectible accounts on an analysis of receivables, the adjusting entry on December 31 had been based on an estimated expense of ½ of 1% of the sales of $15,800,000 for the year, determine the following:Explanation / Answer
Wild Trout Gallery Date/S.N. Account Title & Explanation Debit Credit Amount in $ Amount in $ Allowance for Doubtful accounts Jan-19 Accounts Receivable 2660 Accounts Receivable 12750 Beginning Balance 50000 Allowance for Doubtful accounts 2660 Accounts Receivable 16500 Accounts Receivable 2660 To record the reinstatement of amount receivable from Arlene Gurley Accounts Receivable 24000 Accounts Receivable 4000 Bad debts expense 60000 Cash 2660 Ending balance 63410 Accounts Receivable 2660 116660 116660 To Record the receipt of cash from a Customer Apr-03 Allowance for Doubtful accounts 12750 Accounts Receivable 12750 To record the writing off of Balance receivable from Premier GS Co. Bad debts expense Allowance for Doubtful accounts 60000 Jul-16 Allowance for Doubtful accounts 16500 Ending Balance 60000 Accounts Receivable 16500 To record the writing off of Balance receivable from Hayden Co. 60000 60000 Nov-23 Accounts Receivable 4000 Allowance for Doubtful accounts 4000 To record the reinstatement of amount receivable from Harry Carr Cash 4000 Accounts Receivable 4000 To Record the receipt of cash from a Customer Dec-31 Allowance for Doubtful accounts 24000 Accounts Receivable 24000 To record the writing off of receivable from Cavey Co., Fogle Co., Lake Furniture & Melinda shryer Dec-31 Bad debts expense 60000 Allowance for Doubtful accounts 60000 To record the bad-debt expense of the year Requirement 3 Expected net realizable value Accounts Receivable 2350000 Less : Allowance for Doubtful accounts 63410 2286590 Requirement 4 4A Dec-31 Bad debts expense 79000 =15800000*1%*0.5 Allowance for Doubtful accounts 79000 To record the bad-debt expense of the year 4B See T accounts aside Balance in the allowance Account will be as follows Allowance for Doubtful accounts Accounts Receivable 12750 Beginning Balance 50000 Accounts Receivable 16500 Accounts Receivable 2660 Accounts Receivable 24000 Accounts Receivable 4000 Bad debts expense 79000 Ending balance 82410 135660 135660 4C Expected net realizable value Accounts Receivable 2350000 Less : Allowance for Doubtful accounts 82410 2267590 Please do not forget to rate the answer Thank You
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