Question

In: Accounting

The Accounts Receivable balance for Gold​, Inc. at December​ 31, 2017​, was $27,000. During 2018​, Gold...

The Accounts Receivable balance for Gold​, Inc. at December​ 31, 2017​, was $27,000. During 2018​, Gold earned revenue of 461,000 on account and collected $326,000 on account. Gold wrote off $6,400 receivables as uncollectible. Industry experience suggests that uncollectible accounts will amount to 2​% of accounts receivable.

1. Assume Gold had an unadjusted $1,800 credit balance in Allowance for Bad Debts at December ​31, 2018. Journalize Gold​'s December ​31, 2018​, adjustment to record bad debts expense using the​ percent-of-receivables method.

2.  Assume Gold had an unadjusted $1,500 debit balance in Allowance for Bad Debts at December ​31, 2018. Journalize Gold​'s December ​31, 2018​, adjustment to record bad debts expense using the​ percent-of-receivables method.

Solutions

Expert Solution

  • General Working

Accounts receivables beginning balance

$27,000

Sales on account

$461,000

Cash Collection

($326,000)

Written off

($6,400)

Accounts receivables ending balance

$155,600

  • Requirement 1

Date

Accounts title

Debit

Credit

31-Dec-18

Bad Debt Expense

$1,312

   Allowance for Doubtful accounts

$1,312

>Working

A

Accounts receivables ending balance

$155,600

B = A x 2%

Adjusted balance in Allowance account required

$3,112

Credit

C

Unadjusted balance in Allowance account

$1,800

Credit

D = B - C

Bad Debt Expense

$1,312

  • Requirement 2

Date

Accounts title

Debit

Credit

31-Dec-18

Bad Debt Expense

$4,612

   Allowance for Doubtful accounts

$4,612

>Working

A

Accounts receivables ending balance

$155,600

B = A x 2%

Adjusted balance in Allowance account required

$3,112

Credit

C

Unadjusted balance in Allowance account

$1,500

Debit

D = B + C

Bad Debt Expense

$4,612

ekkarill92 answered 2 months ago
Next > < Previous

Related Solutions

Boca Inc. Balance Sheets December 31 Assets 2018 2017 Cash 110,800 48,400 Accounts Receivable 38,000 87,800...
Boca Inc. Balance Sheets December 31 Assets 2018 2017 Cash 110,800 48,400 Accounts Receivable 38,000 87,800 Inventory 112,500 102,850 Prepaid Expenses 26,000 28,400 Long-term Investments 109,000 138,000 Plant Assets 397,000 242,500 Accumulated depreciation -50,000 -52,000 Total 743,300 595,950 Liabilities and Stockholders' Equity Accounts Payable 72,000 67,300 Accrued Expenses Payable 13,500 21,000 Dividends Payable 3,000          - Bonds Payable 170,000 146,000 Common Stock 262,000 175,000 Retained Earnings 222,800 186,650 Total 743,300 595,950 Additional Information: 1. Old plant assets having an original...
Boca Inc. Balance Sheets December 31 Assets 2018 2017 Cash 60,800 48,400 Accounts Receivable 87,800 38,000...
Boca Inc. Balance Sheets December 31 Assets 2018 2017 Cash 60,800 48,400 Accounts Receivable 87,800 38,000 Inventory 102,850 112,500 Prepaid Expenses 28,400 26,000 Long-term Investments 138,000 109,000 Plant Assets 347,000 242,500 Accumulated depreciation (50,000) (52,000) Total 714,850 524,400 Liabilities and Stockholders' Equity Accounts Payable 67,300 72,000 Accrued Expenses Payable 21,000 13,500 Dividends Payable 3,000 - Bonds Payable 170,000 146,000 Common Stock 262,000 175,000 Retained Earnings 191,550 117,900 Total 714,850 524,400 Additional Information: 1. Old plant assets having an original cost...
SMC, Inc. Balance Sheet December 31, 2017 Assets Cash ......................................................................................................... $34,500 Accounts receivable ...................................................................
SMC, Inc. Balance Sheet December 31, 2017 Assets Cash ......................................................................................................... $34,500 Accounts receivable ................................................................................ 25,000 Inventory .................................................................................................. 10,000 Supplies ................................................................................................... 200 Total assets.............................................................................................. $69,700 Liabilities and Stockholders’ Equity Liabilities: Accounts payable ............................................................................. $12,000 Salaries payable ............................................................................... 1,000 Income taxes payable ...................................................................... 3,675 Total liabilities.......................................................................................... $16,675 Stockholders’ equity: Capital stock (10,000 shares outstanding).................................... $25,000 Retained earnings ............................................................................ 28,025 Total stockholders’ equity ....................................................................... 53,025 Total liabilities and stockholders’ equity................................................ $69,700 SMC, Inc. Income Statement For the Year Ended December31,2017 Sales revenue .............................................................................................
At December 31, 2018 before any year-end adjustments, the Accounts Receivable balance of Daulat Inc is...
At December 31, 2018 before any year-end adjustments, the Accounts Receivable balance of Daulat Inc is $300,000. Credit sales for the 2018 are $900,000, and allowance for bad debt has a $10,000 beginning credit balance. Daulat Inc prepares the following aging schedule for accounts receivable (age, amount, estimated uncollectible) 0-30 Days $150,000 1% 31- 60 Days $100,000 4% 61 -90 Days $40,000 10% Over 90 Days $10,000 40% 1. Calculate the balance in the allowance for bad debt on December...
An aging analysis of Yamoto Limited’s accounts receivable at December 31, 2018 and 2017, showed the...
An aging analysis of Yamoto Limited’s accounts receivable at December 31, 2018 and 2017, showed the following: Number of Days Outstanding Accounts Receivable Estimated Percentage Uncollectible 2018 2017 0-30 days $300,000 $320,000 3% 31-61 days 64,000 114,000 6% 61-90 days 86,000 76,000 12% Over 90 days 130,000 50,000 24% Total $580,000 $560,000 Additional information: 1. At December 31, 2017, the unadjusted balance in Allowance for Doubtful Accounts was a credit of $9,000. 2. In 2018, $42,000 of accounts were written...
An aging analysis of Yamoto Limited’s accounts receivable at December 31, 2018 and 2017, showed the...
An aging analysis of Yamoto Limited’s accounts receivable at December 31, 2018 and 2017, showed the following: Number of Days Outstanding Accounts Receivable Estimated Percentage Uncollectible 2018 2017 0-30 days $300,000 $320,000 3% 31-61 days 64,000 114,000 6% 61-90 days 86,000 76,000 12% Over 90 days 130,000 50,000 24% Total $580,000 $560,000 Additional information: 1. At December 31, 2017, the unadjusted balance in Allowance for Doubtful Accounts was a credit of $9,000. 2. In 2018, $42,000 of accounts were written...
Financial Statements A list of accounts for Lloyd Inc. at December 31, 2017, follows: Accounts Receivable...
Financial Statements A list of accounts for Lloyd Inc. at December 31, 2017, follows: Accounts Receivable $56,359 Net purchases $61,608 Advertising Expense 12,900 Retained Earnings, January 1, 2017 28,252 Capital Stock 50,000 Salaries Payable 650 Cash 22,340 Net sales 111,760 Dividends 6,000 Transportation-In 375 Income Tax Expense 1,450 Utilities Expense 1,800 Income Tax Payable 1,450 Wages and Salaries Expense 23,000 Inventory: Wages Payable 120    January 1, 2017 6,400    December 31, 2017 5,900 1. Determine cost of goods sold for 2017....
The December 31, 2017 balance sheet of Barone Company had Accounts Receivable of $400,000 and a...
The December 31, 2017 balance sheet of Barone Company had Accounts Receivable of $400,000 and a credit balance in Allowance for Doubtful Accounts of $32,000. During 2018, the following transactions occurred: sales on account $1,500,000; sales returns and allowances, $50,000; collections from customers, $1,250,000; accounts written off $36,000; previously written off accounts of $6,000 were collected. If the company uses the percentage of receivables basis to estimate bad debt expense and determines that uncollectible accounts are expected to be 8%...
Recognition and Valuation of Accounts Receivable The December 31, 2018 balance sheet of the Kramer Company...
Recognition and Valuation of Accounts Receivable The December 31, 2018 balance sheet of the Kramer Company had Accounts Receivable of 650,000 and a credit balance in Allowance for Doubtful Accounts of $33,000. During 2019, the following transactions occurred: sales on account $1,550,000; sales returns and allowances, $100,000; collections from customers, $1,250,000; accounts written off, $35,000; previously written off accounts of $8,000 were collected. Instructions (a)   Journalize the 2019 transactions. (b)   If the company uses the percentage of receivables basis to...
The December 31, 2018 balance sheet of Jenson Company had Accounts Receivable of $450,000 and a...
The December 31, 2018 balance sheet of Jenson Company had Accounts Receivable of $450,000 and a credit balance in Allowance for Doubtful Accounts of $33,000. During 2019, the following transactions occurred: Sales on account $1,600,000 Sales returns and allowances, $75,000 Collections from customers, $1,450,000 Accounts written off $35,000 Previously written off accounts of $6,000 were collected (a) Journalize the 2019 transactions. Disregard any impact on inventory. (b)   If Jenson uses the percentage of sales basis to estimate bad debts expense...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT