Accounting 102 Receivables and doubtful accounts 1. What does uncollectible accounts or bad debts refer to? 2. Write a complete sentence using the terms principal, interest, maturity value and rate. 3. Explain the term receivables. Be explicit. 4. How does Allowance for uncollectible accounts affect the balance sheet? 5. Explain the % of sales method and the aging of accounts receivable method. How do they work? 6. What two basic entries are used when an account is reinstated and paid in full? 7. What is the major difference between an accounts receivable and notes receivable? 8. What would the % chance of an account that is 90 days overdue be as far as it being collected? 9. What is a compound entry? 10. How would you determine your % for the sales on account method? Record the following transactions Dec. 1Received a $4000 45 day 10% note on account from Mary Martella Dec. 1Sold goods to Noreen Barton receiving a $9000 four month 8% note. Collected the maturity value on both notes from Dec. 1. Jan 1 Loaned $12000 cash to Adina receiving a note at 5% interest for 2 months. Jan. 1 Sold goods to Chris Griggs the Electrician receiving a $14,000 nine month, 8% note Feb.5 Recorded an adjusting entry to record the estimated amount of accounts that will not be collected based on 4 of 3% of $450,000 net sales. Mar 28 Wrote off three accounts Ruiz: $140, Jones $1576 and Castro $2000 as uncollectible. June 1 Reinstated and received payment for the Ruiz account for the full amount. April 1 Loaned Mary Brennan $35,000 receiving a 10month, 15% note. April 30: Wrote off the Marion Valez account as uncollectible in the amount of $12500. Received payment from Ed the Electrician for the maturity value of the note Figure the amount of uncollectible on the following using the aging method 0-30 31-60 61-90 over 90 Accounts 15,000 4,000 $2500 $1000 .1% 1% 5% 40%