ABC Inc.'s accounting records disclose the following:P 1,800,000Accounts receivable, January 1, 2021Allowance for doubtful accounts, January 1, 2021 (credit balance)Sales for the yearCollections from customers during the year90,00015,000,00013,080,000The following additional information was also obtained:> Included in the amount collected from customers was the recovery of P30,000 receivablefrom a customer whose account had been charged off as worthless in the prior year.> ABC determined that its receivable from a customer of P150,000 will not be collected, andmanagement authorized its writeoff.> A customer settled its account on December 2, 2021 by issuing a 12%, 6-month note forP600,000.> The accounts receivable balance on December 31, 2021 includes P900,000 past dueaccounts.> The entity estimated that 20% of past due accounts will not be collected and 5% of thecurrent accounts will not be collected as well.QUESTIONS: (Show your supporting computations in GOOD FORM)The current assets section of ABC Inc.'s statement of financial position on December 31, 2021should include accounts receivable ofa. P3,600,000b. P2,400,000c. P3,000,000d. P2,970,000 What is the balance of the allowance for doubtful accounts before adjustment on December 31, 2021?b. P120,000 creditc. P120,000 debitc. P30,000 creditd. P30,000 debitThe required allowance for doubtful accounts on December 31, 2021 isc. P315,000d. P285,000b. P283,500d. P255,000The allowance for doubtful accounts should be increased (decreased) byb. (P255,000)d. (P313,500)e. P315,000c. P285,000What is the adjusting entry to record the doubtful accounts expense for the current year?f.Doubtful accounts expense285,000Allowance for doubtful accounts285,000g. Doubtful accounts expense315,000Allowance for doubtful accounts315,000h. Allowance for doubtful accountsDoubtful accounts expense255,000255,000i.Allowance for doubtful accounts313,500Doubtful accounts expense313,500

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ABC Inc.'s accounting records disclose the followi Accounts receivable, January 1, 2021 Allowance for doubtful accounts, January Sales for the year Collections from customers during the yea The following additional information was also obta

ABC Inc.'s accounting records disclose the followi Accounts receivable, January 1, 2021 Allowance for doubtful accounts, January Sales for the year Collections from customers during the yea The following additional information was also obta

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter6: Cash And Receivables

Section: Chapter Questions

Problem 12E: Inferring Accounts Receivable Amounts At the end of 2019, Karras Inc. had a debit balance of 141,120...

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Jars Plus recorded $861,430 in credit sales for the year and $488,000 in accounts receivable. The uncollectible percentage is 2.3% for the income statement method, and 3.6% for the balance sheet method. A. Record the year-end adjusting entry for 2018 bad debt using the income statement method. B. Record the year-end adjusting entry for 2018 bad debt using the balance sheet method. C. Assume there was a previous debit balance in Allowance for Doubtful Accounts of $10,220, record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method. D. Assume there was a previous credit balance in Allowance for Doubtful Accounts of $5,470, record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method.
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Estimating Bad Debts from Receivables Balances The following information is extracted from Shelton Corporations accounting records at the beginning of 2019: During 2019, sales on credit amounted to 575,000, 557,400 was collected on outstanding receivables and 2,600 of receivables were written off as uncollectible. On December 31, 2019, Shell on estimastes its bad debts to be 4% of the outstanding gross accounts receivable balance. Required: 1. Prepare the journal entry necessary to record Sheltons estimate of bad debt expense for 2019. 2. Prepare the Accounts Receivable section of Shelton's December 31, 2019, balance sheet. 3. Compute Shelton's receivables turnover. (Round to one decimal place.) 4. It Sheldon uses IFRS, what might be the heading for the accounts receivable section in Requirement 2?
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On 1 June 2020, Mason Ltd. had Accounts Receivable $424,778 and Allowance for Doubtful Debts accounts $6,050. Ignore GST. During June, the following transactions occurred: 1. Revenue earned on credit, $597,500. 2. Sales returns, $12,050. 3. Accounts receivable collected, $700,000. 4. Accounts written off as uncollectable, $5,926. Based on an ageing of accounts receivable on 30 June, the firm determined that the Allowance for Doubtful Debts accountshould have a credit balance of $6,750 on the balance sheet as at 30 June 2020. lgnore GST. Required: a) Prepare general journal entries to record the four transactions. (- b) Prepare journal entriesto adjust the bad debts expense and allowance for doubtful debts account. c) Show how accounts receivable and the allowance for doubtful debts would appear on the balance sheet at 30 June 2020., d) On 10 July 2020, Kent Ltd, whose $1,300 account had been written off as uncollectable in June, paid its account in full. Prepare journal entries to…
On 1 June 2020, Mason Ltd. had Accounts Receivable $424,778 and Allowance for Doubtful Debtsaccounts $6,050. Ignore GST.During June, the following transactions occurred:1. Revenue earned on credit, $597,500.2. Sales returns, $12,050.3. Accounts receivable collected, $700,000.4. Accounts written off as uncollectable, $5,926.Based on an ageing of accounts receivable on 30 June, the firm determined that the Allowance forDoubtful Debts account should have a credit balance of $6,750 on the balance sheet as at 30 June2020. Ignore GST.Required:a) Prepare general journal entries to record the four transactions. b) Prepare journal entries to adjust the bad debts expense and allowance for doubtful debtsaccount. c) Show how accounts receivable and the allowance for doubtful debts would appear on thebalance sheet at 30 June 2020. d) On 10 July 2020, Kent Ltd, whose $1,300 account had been written off as uncollectable in June,paid its account in full. Prepare journal entries to record the…
VKS Company had the following information relating to its accounts receivable: · Accounts receivable, 12/31/2020- P780,000· Credit sales during 2021- P3,290,000· Collections from customers during 2021 (excluding recovery of P20,000)- P3,640,000· Accounts written off during 2021- P85,000· Collection of accounts written off in prior years- P20,000· Estimated uncollectible accounts per aging at 12/31/2021- P63,000 At December 31, 2021, VKS Company's accounts receivable before allowance for uncollectible accounts should be
Johnson Ltd. reported the following information on financial statements for the year ended December 31, 2019: Accounts receivable $3,001,000 Allowance for doubtful accounts 94,930 Bad debts expense 153,130 Assume all 2019 balance are normal balances. During 2020, the company had the following transactions related to receivables: 1. Sales were $26,421,000, of which $21,105,000 were on account. 2. Collections of accounts receivable were $19,762,000. 3. Writeoffs of accounts receivable were $102,800. 4. Recoveries of accounts previously written off as uncollectible were $21,100. (Note that this amount is not included in the collections referred to in item b above. On December 31, 2019, Mills Manufacturing Ltd. had a $176,000 balance in its Accounts Receivable and a $10,000 balance in its Allowance for Doubtful Accounts. During 2020, the company made total sales of $955,000, of which $230,000 were cash sales. By the end of the year, Mills had received payments of $654,000 from its…
At December 31, 2018, Oriole Company reported the following information on its balance sheet. Accounts receivable $948,000 Less: Allowance for doubtful accounts 78,000 During 2019, the company had the following transactions related to receivables. 1. Sales on account $3,609,930 2. Sales returns and allowances 51,000 3. Collections of accounts receivable 2,756,000 4. Write-offs of accounts receivable deemed uncollectible 97,000 5. Recovery of bad debts previously written off as uncollectible 28,000 Compute the accounts receivable turnover for 2019, assuming the expected bad debt information provided in (c). (Round answer to 2 decimal places, e.g. 25.25.)