Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

2 6 Exercise 7 - 7 A ( Algo ) Effect of recognizing uncollectible accounts on the financial statements: Percent of receivables allowance method LO

26Exercise 7-7A (Algo) Effect of recognizing uncollectible accounts on the financial statements: Percent of
receivables allowance method LO 7-2
[The following information applies to the questions displayed below.]
Leach Incorporated experienced the following events for the first two years of its operations:
Year 1:
Issued $10,000 of common stock for cash.
Provided $80,000 of services on account.
Provided $33,000 of services and received cash.
Collected $47,000 cash from accounts receivable.
Paid $16,000 of salaries expense for the year.
Adjusted the accounting records to reflect uncollectible accounts expense for the year. Leach estimates that 6 percent
of the ending accounts receivable balance will be uncollectible.
Year 2:
Wrote off an uncollectible account for $2,630.
Provided $100,000 of services on account.
Provided $30,000 of services and collected cash.
Collected $82,000 cash from accounts receivable.
Paid $22,000 of salaries expense for the year.
Adjusted the accounts to reflect uncollectible accounts expense for the year. Leach estimates that 6 percent of the
ending accounts receivable balance will be uncollectible.
Exercise 7-7A (Algo) Part d
d-1. Organize the transaction data in accounts under an accounting equation for Year 2.
d-2. Prepare an income statement for Year 2.
d-3. Prepare the statement of changes in stockholders' equity for Year 2.
d-4. Prepare the balance sheet for Year 2.
d-5. Prepare the statement of cash flows for Year 2.
d-6. What is the net realizable value of the accounts receivable at December 31, Year 2?
Answer is not complete.
Complete this question by entering your answers in the tabs below.
Req D6
Organize the transaction data in accounts under an accounting equation for Year 2.
Note: Enter any decreases to account balances with a minus sign. Not all cells require input. Round your intermediate calculations and final answer to the
nearest whole dollar.
How do I find the uncollectible account expense?
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Management For Public Health And Not For Profit Organizations

Authors: Steven A. Finkler

3rd Edition

0136070736, 978-0136070733

More Books

Students also viewed these Accounting questions