junkletter6266
15.07.2021 •
Business
Providing for Doubtful Accounts At the end of the current year, the accounts receivable account has a debit balance of $962,000 and sales for the year total $10,910,000. The allowance account before adjustment has a credit balance of $13,000. Bad debt expense is estimated at 3/4 of 1% of sales. The allowance account before adjustment has a credit balance of $13,000. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $41,600. The allowance account before adjustment has a debit balance of $9,000. Bad debt expense is estimated at 1/4 of 1% of sales. The allowance account before adjustment has a debit balance of $9,000. An aging of the accounts in the customer ledger indicates estimated doubtful accounts of $74,700. Determine the amount of the adjusting entry to provide for doubtful accounts under each of the assumptions (a through d) listed above.
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Ответ:
Providing for Doubtful Accounts
The amount of the adjusting entry to provide for doubtful accounts are:
a) = $68,825
b) = $28,600
c) = $36,275
d) = $83,700
Explanation:
a) Data and Calculations:
Accounts receivable balance = $962,000
Sales for the year = $10,910,000
Allowance account before adjustment = $13,000 (credit)
Estimated Bad Debt Expense = 3/4 of 1% of Sales
= 3/4 * 1% * $10,910,000
= $81,825
Bad Debt Expense = $68,825 ($81,825 - $13,000)
b) Allowance account before adjustment = $13,000 (credit)
Estimated doubtful accounts = $41,600
Bad Debts Expense = $28,600 ($41,600 - $13,000)
c) Allowance account before adjustment = $9,000 (debit)
Estimated Bad Debt Expense = 1/4 of 1% of Sales
= 1/4 * 1% * $10,910,000
= $27,275
Bad Debt Expense = $36,275 ($27,275 + $9,000)
d) Allowance account before adjustment = $9,000 (debit)
Estimated doubtful accounts = $74,700
Bad Debts Expense = $83,700 ($74,700 + $9,000)
The adjusting entry is:
Debit Bad Debts Expense
Credit Allowance for Doubtful Accounts
With the amount of the adjusting entry in each case
Ответ:
The lender and borrower agree to the amount borrowed, the loan amount, the interest rate and the monthly payment, which depend on the borrower's credit rating.Generally, real estate and auto loans are closed-end credit, but home-equity lines of credit and credit cards are revolving lines of credit or open-end.