In: Accounting
Young and Restless Corporation (YRC) uses two aging categories to estimate uncollectible accounts. Accounts less than 60 days are considered current and have a 5% uncollectible rate. Accounts more than 60 days are considered delinquent and have a 30% uncollectible rate.. YRC’s Allowance for Doubtful Accounts currently has an unadjusted credit balance of $551
If YRC has $54,080 of current accounts and $4,910 of delinquent accounts, how much should be reported in the Allowance for Doubtful Accounts? 54080*.05 + 4910*.30 -551 = 3626 IS WRONG
Assume Brandall Co. had credit sales of $157,502 and cost of goods sold of $56,648 for the period. Brandall uses the percentage of credit sales method and estimates that 1 percent of credit sales would result in uncollectible accounts. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a debit balance of $723.
What is the adjusted (ending) balance in the Allowance for Doubtful Accounts that Brandall would report on the Balance Sheet? $________ 157502*.01 = 1575.02 IS WRONG
Assume Brandall Co. had credit sales of $159,059 and cost of goods sold of $67,067 for the period. Brandall uses the percentage of credit sales method and estimates that 3 percent of credit sales would result in uncollectible accounts. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $402.
What amount of Bad Debt Expense would the company record as an end-of-period adjustment? 159059*.03 - 402 IS WRONG
At the beginning of Year 3 Randall Company had a $17,020 balance in its accounts receivable account and a $1,330 balance in allowance for doubtful accounts. During Year 3, Randall experienced the following events.
(1) Randall earned $24,400 of revenue on account.
(2) Collected $17,770 cash from accounts receivable.
(3) Wrote-off $870 of accounts receivable as uncollectible.
Randall estimates uncollectible accounts to be 3% of receivables. Based on this information, the December 31, Year 3 the ending balance in the allowance for doubtful accounts account (balance after expense recognition) is $_________24400-17770-870 = 22780*.03 IS WRONG
ans 1 In this question balance of allowance for doubtful accounts is asked which is | |||
54080*5% | $2,704 | ||
4910*30% | $1,473 | ||
Ending Balance of Allowance for Doubtful accounts | $4,177 | ||
The ending balance is this only | |||
For your understanding | |||
when we have to calculate bad debt expense in that case deduct 551 | |||
Bad debt expenses are 4177-551 | $3,626 | ||
ans 2 | |||
Allowance for Doubtful accounts | |||
Beginning bal | ($723) | ||
1% of credit sale (157502*1%) | $1,575.02 | ||
Ending Balance of Allowance for Doubtful accounts | $852.02 | ||
If rounded off | $852 | ||
ans 3 | |||
Bad debt expense would be calculated straight on % of credit sale | |||
159059*3% | 4771.77 | ||
ans 4 | |||
Receivables are | |||
17020+24400-17770-870 | 22780 | ||
3% of 22780 | 683.40 | ||
Ending balance of allowance | |||
1330-870+683.4 | $1143.4 | ||