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anonymous1813
16.11.2020 •
Business
At December 31, 2019, Obermeyer Imports reported the following information on its balance sheet.
Accounts receivable $250,000
Less: Allowance for doubtful accounts 15,000
During 2019, the company had the following transactions related to receivables.
1. Sales on account $2,600,000
2. Sales returns and allowances 45,000
3. Collections of accounts receivable 2,250,000
4. Write-offs of accounts receivable deemed uncollectible 10,000
5. Recovery of bad debts previously written off as uncollectible 3,000
Instructions
(a) Prepare the journal entries to record each of these five transactions. Assume that no cash discounts were taken on the collections of accounts receivable.
(b) Enter the January 1, 2019, balances in Accounts Receivable and Allowance for Doubtful Accounts. Post the entries to the two accounts (use T-accounts), and determine the balances.
(c) Prepare the journal entry to record bad debt expense for 2019, assuming that an aging of accounts receivable indicates that estimated bad debts are $22,000.
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Ответ:
The journal entries to record each of the transactions will be:
Debit Accounts Receivable $2,600,000
Credit Sales Revenue $2,600,000
(To record the sale of goods on account)
Debit Sales Returns $45,000
Credit Accounts Receivable $45,000
(To record the return of goods on account).
Debit Cash Account $2,250,000
Credit Accounts Receivable $2,250,000
(To record collections from customers)
Debit Uncollectible Expenses $10,000
Credit Accounts Receivable $10,000
(To record the write-off of accounts deemed uncollectible).
Debit Cash Account $3,000
Credit Uncollectible Expenses $3,000
(To record the recovery of bad debts previously written off)
The balances in accounts receivable and allowance for doubtful accounts will be calculated thus:
Debit Beginning balance $250000.
Debit sales revenue $2,600,000.
Credit Sales return $45000
Credit Cash account $2250000
Credit Uncollectible expenses $10000
Credit ending balances $545000
Lastly, the journal entry to record bad debt expense for 2019 will be:
Debit Uncollectible expense $7000.
Credit Allowance for doubtful accounts $7000.
Learn more about journal entries on;
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Ответ:
Obermeyer Imports
a) Journal Entries to record each transaction:
1. Debit Accounts Receivable $2,600,000
Credit Sales Revenue $2,600,000
To record the sale of goods on account.
2. Debit Sales Returns $45,000
Credit Accounts Receivable $45,000
To record the return of goods on account.
3. Debit Cash Account $2,250,000
Credit Accounts Receivable $2,250,000
To record collections from customers.
4. Debit Uncollectible Expenses $10,000
Credit Accounts Receivable $10,000
To record the write-off of accounts deemed uncollectible.
5. Debit Cash Account $3,000
Credit Uncollectible Expenses $3,000
To record the recovery of bad debts previously written off.
b) T-accounts:
Accounts Receivable
Accounts Titles Debit Credit
Beginning balances $250,000
Sales Revenue 2,600,000
Sales Returns 45,000
Cash Account 2,250,000
Uncollectible Expenses 10,000
Ending Balances 545,000
Total $2,850,000 $2,850,000
Allowance for doubtful accounts
Accounts Titles Debit Credit
Beginning balances $15,000
Uncollectible expense 7,000
Ending balances $22,000
c) Journal Entry
Debit Uncollectible Expense $7,000
Credit Allowance for doubtful accounts $7,000
To record the allowance for uncollectibles.
Explanation:
a) Data and Calculations:
Accounts receivable $250,000
Less: Allowance for doubtful accounts 15,000
b) The allowance for Doubtful Accounts will increase by $7,000 to $22,000. As a result, the Uncollectible Expense will be debited with $7,000 while the Allowance for doubtful accounts will be credited with $7,000. This brings the total of Allowance for Doubtful Accounts to $22,000 in accordance with the new estimate based on the aging of accounts receivable.
Ответ:
More investment funds are made available to business ( 4 )
Explanation:
Capital deepening is the increase in the capital per worker in an economy it can also be said to be change in capital stock/intensity per labor hour.
Capital deepening is an important source of economic growth because more physical capital cause an increase in efficiency and productivity in the economy. also capital deepening causes an investment in human capital by employers of labor which will also make the workers to be more valuable to production and employers of labor.