22. Kaur Company had a January 1, 2022 balance in Allowance for Doubtful Accounts of $4,000 credit. The estimated Bad Debts are 1.5 percent of net credit sales. During 2022, net credit sales were equal to $416,200. Other transactions for 2022 were as follows:

Feb. 10 A $1,000, 60-day, 12 percent note receivable was dishonoured. Collection was expected at a later date.

Apr. 15 Aadi Gagnejas account receivable of $3,900 was deemed uncollectible.

July 1 Minh Le paid the full amount ($1,275) of his previously written-off account receivable. The receivable had been written off in 2021.

What should be the December 31, 2022 balance in the Allowance for Doubtful Accounts account after adjustment?

a. $ 6,343

b. $ 7,618

c. $ 6,618

d. $ 8,618

e. $11,518

23, Ncube Company ages its Accounts Receivable to determine the end-of-period adjustment for Bad Debts. At the end of 2022, management estimated that $14,750 of the Accounts Receivable balances would be uncollectible. The Allowance for Doubtful Accounts account had a debit balance of $175 before adjustment. What adjusting journal entry should Ncube make on December 31, 2022, to estimate bad debts expense?

a. Bad Debts Expense .. 14,750

Allowance for Doubtful Accounts .. 14,750

b. Bad Debts Expense .. 14,575

Allowance for Doubtful Accounts .. 14,575

c. Bad Debts Expense .. 14,925

Allowance for Doubtful Accounts .. 14,925

d. Accounts Receivable 14,750

Bad Debts Expense ... 175

Allowance for Doubtful Accounts .. 14,925

e. Accounts Receivable 14,925

Allowance for Doubtful Accounts .. 14,925

24. Mayer Company sells $500 (before tax) of merchandise (on account). The cost of the merchandise sold was $350. Assuming an HST rate of 13% and a perpetual inventory system, the journal entry (or entries) made by Mayer Company would be:

a. Accounts Receivable . 565

Sales . 500

HST Payable . 65

b. 1) Accounts Receivable . 565

Sales . 565

2) Cost of Goods Sold . 350

Merchandise Inventory .. 350

c. 1) Accounts Receivable . 500

HST Recoverable 65

Sales . 565

2) Cost of Goods Sold . 350

Merchandise Inventory .. 350

d. 1) Accounts Receivable . 565

Sales . 500

HST Payable 65

2) Cost of Goods Sold . 350

Merchandise Inventory .. 350

8. The following information is available for PQR Company:

2022 2021

Credit Sales $800,000 $550,000

Sales Returns 100,000 50,000

Gross Accounts Receivable 27,000 24,000

The accounts receivable collection period for 2022 is:

1. 27.45 days
2. 9.80 days
3. 13.30 days
4. 26.58 days
5. None of the above.

6. On March 5, 2022, MNO Company accepted a $3,000, 2-month, 10%

note in granting a time extension on the past-due Accounts Receivable of

Vasilika Dhami. On May 5, 2022, Vasilika Dhami paid the maturity value of her

$3,000 note. What is the journal entry made by MNO Company to

record the payment of the note? (All interest is paid at maturity).

a. Cash --------------------------------------------------------------- 3,000

Interest Revenue ---------------------------------------------- 50

Notes Receivable - V.Dhami -------------------------- 3,050

b. Cash -------------------------------------------------------------- 3,300

Interest Revenue ----------------------------------------- 300

Notes Receivable - V. Dhami --------------------------- 3,000

c. Cash --------------------------------------------------------------- 3,050

Interest Revenue ----------------------------------------- 50

Notes Receivable - V. Dhami --------------------------- 3,000

d. Cash --------------------------------------------------------------- 3,300

Notes Receivable - V. Dhami --------------------------- 3,300

e. Cash --------------------------------------------------------------- 3,050

Accounts Receivable - V. Dhami ---------------------- 3,050