6. On January 1, 20X1, Mechanical Engineers, Inc. had an accounts receivable balance of $650,000 and a credit balance in the allowance for uncollectible accounts of $50,000.During January, the company had credit sales of $3,210,000, collections on credit sales of $2,990,000, and write offs of uncollectible accounts receivable totaling $48,000.All of the company's sales are credit sales.

oPrepare journal entries to record the credit sales, cash collections, and accounts, receivable write offs for January.

oMechanical Engineers, Inc. estimates that 6.5% of the accounts receivable balance will become uncollectible. Prepare the journal entry for bad debt expense.

oShow the balance sheet presentation of accounts receivable as of January 31, 20X1.

7. Before adjusting entries were made at December 31, 20X9, Jason Designs, Inc. had an accounts receivable balance of $990,000 and a credit balance in allowance for uncollectible accounts of $4,075. The following aged accounts receivable report as of December 31, 20X9 is available for Jason Designs, Inc.:

Age of Accounts Receivable.

Total Balance1-30 Days31-60 Days61-90 DaysOver 90 Days

$990,000$400,000$285,000$195,000$110,000

Estimated uncollectible.5%1.5%6%40%

(a)Prepare the December 31, 20X9 adjusting entry needed based on the aging schedule.

(b)Show how Jason Designs, Inc. will report accounts receivable on its balance sheet on December 31, 20X9.

8. Davis Co. sold equipment for $50,000 that originally cost $70,000. If this sale appropriately resulted in a gain on sale of $30,000, what was the accumulated depreciation on the sale date?

a.$10,000.

b.$30,000.

c.$50,000.

d.None of the above.

9. Lindley Corp. leased office space from Leaseco Inc. for a seven year period beginning January 1, 20X2. Lindley Corp. invested $84,000 in improvements to the leased property. These improvements have an estimated useful service life of 10 years. As of January 1, 20X5, what was the book or carrying value of the leasehold improvements on Lindley Corp.'s books?

a.$84,000 since no amortization is required.

b.$58,800.

c.$48,000.

d.$0 since the improvement costs should have been expensed immediately when they were incurred.