Question
1) A company has the following accounts receivable and estimates of uncollectible accounts: 1. Accounts not yet due = $60,000; estimated uncollectible = 3%. 2.
1) A company has the following accounts receivable and estimates of uncollectible accounts:
1. Accounts not yet due = $60,000; estimated uncollectible = 3%.
2. Accounts 1-30 days past due = $20,000; estimated uncollectible = 20%.
3. Accounts more than 30 days past due = $10,000; estimated uncollectible = 50%.
Compute the total estimated uncollectible accounts.
Estimated uncollectible accounts:
2)
At the end of 2018, Murray State Lenders had a balance in its Allowance for Uncollectible Accounts of $4,500 (credit) before any adjustment. The company estimated its future uncollectible accounts to be $12,000 using the percentage-of-receivables method. Murray State's adjustment on December 31, 2018, to record its estimated uncollectible accounts included a:
Credit to Allowance for Uncollectible Accounts of $7,500.
Credit to Allowance for Uncollectible Accounts of $12,000.
Debit to Bad Debt Expense of $7,500; credit to Allowance for Uncollectible Accounts of $7,500.
Debit to Bad Debt Expense of $7,500.
3)
On February 1, 2018, Sanger Corp. lends cash and accepts a $5,500 note receivable that offers 18% interest and is due in six months. What would Sanger record on August 1, 2018, when the borrower pays Sanger the correct amount owed?
A)
Cash | 5,995 | |
Interest Revenue | | 495 |
Notes Receivable | | 5,500 |
B)
Cash | 5,995 | |
Notes Receivable | | 5,995 |
C)
Cash | 5,995 | |
Interest Revenue | | 330 |
Notes Receivable | | 5,665 |
D)
Cash | 5,500 | |
Notes Receivable | | 5,500 |
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