Loose Leaf for Financial Accounting: Information for Decisions
9th Edition
ISBN: 9781260158762
Author: John J Wild
Publisher: McGraw-Hill Education
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Hitachi, Ltd., reports total revenues of ¥10,034,305 million for its current fiscal year, and its current fiscal year-end unadjusted trial balance reports a debit balance for trade receivables (gross) of ¥2,992,770 million. a. Prepare the adjusting entry to record its bad debts expense assuming uncollectibles are estimated to be 0.4% of total revenues and its unadjusted trial balance reports a credit balance of ¥10,000 million for the Allowance for Doubtful Accounts. b. Prepare the adjusting entry to record bad debts expense assuming uncollectibles are estimated to be 2.0% of year-end trade receivables (gross) and its unadjusted trial balance reports a credit balance of ¥10,000 million for the Allowance for Doubtful Accounts.
Errol Company estimates its allowance for doubtful accounts usingpercentage of sales method. The total sales of the company for 2021amounted to P10,000,000, P3,000,000 of which are sold for cash. Erroldetermined that 12% is an appropriate estimate of bad debts expense.Errol also provided the following information:Write-offs during the period amounted to P500,000Allowance for doubtful accounts at the beginning of 2021 amounted toP285,000Recoveries of amounts previously written-off amounted to P120,000The accounts receivable as of December 31, 2021 is P5,000,000How much is the allowance for doubtful expense account as ofDecember 31, 2021?
Chapter 7 Solutions
Loose Leaf for Financial Accounting: Information for Decisions
Ch. 7 - Prob. 1DQCh. 7 - Prob. 2DQCh. 7 - Prob. 3DQCh. 7 - Prob. 4DQCh. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - Prob. 8DQCh. 7 - Prob. 9DQCh. 7 - Prob. 10DQ
Ch. 7 - Prob. 1QSCh. 7 - Solstice Company determines on October 1 that it...Ch. 7 - Solstice Company determines on October 1 that it...Ch. 7 - The following list describes aspects of either the...Ch. 7 - Gomez Corp. uses the allowance method to account...Ch. 7 - Prob. 6QSCh. 7 - Prob. 7QSCh. 7 - Prob. 8QSCh. 7 - On August 2, Jun Co. receives a $6,000, 90-day,...Ch. 7 - Prob. 10QSCh. 7 - Prob. 11QSCh. 7 - Prob. 12QSCh. 7 - Prob. 13QSCh. 7 - Prob. 14QSCh. 7 - Prob. 1ECh. 7 - Prob. 2ECh. 7 - Prob. 3ECh. 7 - Prob. 4ECh. 7 - Prob. 5ECh. 7 - Prob. 6ECh. 7 - Prob. 7ECh. 7 - Prob. 8ECh. 7 - Prob. 9ECh. 7 - Prob. 10ECh. 7 - Prob. 11ECh. 7 - Prob. 12ECh. 7 - Prob. 13ECh. 7 - Prob. 14ECh. 7 - Prob. 15ECh. 7 - Prob. 16ECh. 7 - Prob. 17ECh. 7 - Prob. 18ECh. 7 - Prob. 1PSACh. 7 - Prob. 2PSACh. 7 - Prob. 3PSACh. 7 - Prob. 4PSACh. 7 - The following selected transaction are Ohlm...Ch. 7 - Prob. 1PSBCh. 7 - At December 31, 2018, Ingleton Company reports the...Ch. 7 - Prob. 3PSBCh. 7 - Prob. 4PSBCh. 7 - Prob. 5PSBCh. 7 - Prob. 7SPCh. 7 - Prob. 1GLPCh. 7 - Prob. 1FSACh. 7 - Prob. 2FSACh. 7 - Prob. 3FSACh. 7 - Prob. 1BTNCh. 7 - Prob. 2BTNCh. 7 - Prob. 4BTNCh. 7 - Sheryl Sandberg and Mark Zuckerberg of Facebook...
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- Swaziland Company provided the following year-end data: 2021 2020 Accounts receivable P175,000 P129,000 Allowance for doubtful accounts -10,000 -15,000 Net realizable value P165,000 P114,000 Additional information: The entity reported doubtful accounts expense in 2021 of P18,000 and had products returned for credits totaling P9,600 at a sale price. The Gross sales for 2021 amounted to P1,375,000. The entity written-off P23,000 accounts during the year. How much was collected from customers during 2021?arrow_forwardJars 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.arrow_forwardInk Records recorded $2,333,898 in credit sales for the year and $1,466,990 in accounts receivable. The uncollectible percentage is 3% for the income statement method and 5% 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 credit balance in Allowance for Doubtful Accounts of $20,254; record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method.arrow_forward
- FDN Company reported the following on December 31, 2021, before adjustments: Accounts Receivable P13,000,000 Allowance for Doubtful Accounts P300,000 Sales P50,000,000 The entity estimated that 7% of accounts receivable may prove uncollectible. How much should be reported as doubtful accounts expense for the year ended December 31, 2021?arrow_forwardFunnel Direct recorded $1,341,780 in credit sales for the year and $699,455 in accounts receivable. The uncollectible percentage is 4.4% for the income statement method and 4% 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 credit balance in Allowance for Doubtful Accounts of $13,588; record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method. If an amount box does not require an entry, leave it blank. Round your answers to two decimal places. A. Dec. 31 - Select - - Select - - Select - - Select - To record bad debt, income statement method B. Dec. 31 - Select - - Select - - Select - - Select - To record bad debt, balance sheet method C. Dec. 31 - Select - - Select -…arrow_forwardBEBE Co. has outstanding accounts receivable totaling P2.50 million as of December 31 and sales on credit during the year of P10.8 million. There is also a debit balance of P6,000 in the allowance for doubtful accounts. If the company estimates that 1% of its net credit sales will be uncollectible, what will be the balance in the allowance for doubtful accounts after the year-end adjustment to record bad debt expense?arrow_forward
- A trial balance before adjustments included the following: Sales - ₱425,000; sales returns and allowances - ₱14,000; accounts receivable - ₱43,000; Allowance for doubtful accounts -₱760. If the estimate of uncollectible is made by taking 2% of net sales, the amount of bad debts expense for the year is:arrow_forwardFunnel Direct recorded $1,344,780 in credit sales for the year and $698,455 in accounts receivable. The uncollectible percentage is 4.4% for the income statement method and 4% 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 credit balance in Allowance for Doubtful Accounts of $13,788; record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method. If an amount box does not require an entry, leave it blank. Round your answers to two decimal places. А. Dec. 31 To record bad debt, income statement method В. Dec. 31 To record bad debt, balance sheet method C. Dec. 31 To record bad debt, income statement method, previous credit balance Dec. 31 To record bad debt, balance sheet method, previous credit balancearrow_forwardSama company has the following unadjusted account balances at December 31, 2021, Total Sales of $720,000, Accounts Receivable of $205,000 and the allowance was estimated as 3.5% of the total Account Receivable The Allowance for Doubtful Accounts had a credit balance of $2,400, before the estimate was made. Required: Prepare the adjusting journal entry to record bad debts expense for 2021. Answer in the following format [Note: This is just an example and is not related to the question] Jan 1 Dr. Cash 120 Cr. Owner capital ..120arrow_forward
- On December 31, Cosgrove Corporation (a calendar year end corporation) reports an ending balance in accounts receivable (before any adjustments) of $240,000, and total credit sales of $2,900,000 for the year ended December 31, 2022. Crane and Co uses the allowance method to account for uncollectible accounts. Assume Allowance for Doubtful Accounts has an unadjusted balance of ($3,100). Compute the amount of bad debt expense that Cosgrove Corporation will record on December 31, assuming that they use the Percentage of Receivables method to estimate uncollectible accounts. Cosgrove prepared the following aging-of-receivables schedule: Age of Account Current 1-30 days past due 31-90 days past due 91-180 days past due Over 180 days past due Total Accounts Receivable Balance, Dec. 31 $150,000 41,200 26,400 16,200 6,200 $240,000 Estimated Uncollectible Percentage 2% 5% 20% 30% 50%arrow_forwardJars Plus recorded $865,430 in credit sales for the year and $491,000 in accounts receivable. The uncollectible percentage is 2.3% for the income statement method, and 3.0% 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 $5,670, record the year-end entry for bad debt using the income statement method, and then the entry using the balance sheet method. If an amount box does not require an entry, leave it blank. If required, round final answers to two decimal places. A. Dec. 31 Bad Debt Expense v 19,904.89 Allowance for Doubtful…arrow_forwardFrom inception of operations, Comprehensive Company provided for uncollectible accounts expense under the allowance method using the percentage of sales method. No year-end adjustments to the allowance account were made. The balance in the allowance for doubtful accounts was P1,000,000 on January 1, 2020. During the current year, credit sales totaled P20,000,000 interim provisions for doubtful accounts were made at 2% of credit sales, bad debts of P200,000 were written off, and recoveries of accounts previously written off amounted to P50,000. An aging on accounts receivable was made for the first tIme on December 31, 2020. Aging Balance Uncollectible 0 - 60 6,000,000 10% 61 - 180 2,000,000 20% 181 - 360 1,500,000 30% Over 360 500,000 50% Based on the review of collectibility of the account balances in the “over 360 days” aging category, additional accounts totaling P100,000 are to be written off on december 31, 2020. Effective with the year ended December 31,…arrow_forward
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