Question
Accounts Receivable and Credit Losses At the beginning of the year, Whitney Company had the following accounts on its books: Accounts receivable $122,000 Allowance for
Accounts Receivable and Credit Losses
At the beginning of the year, Whitney Company had the following accounts on its books:
Accounts receivable | $122,000 |
Allowance for doubtful accounts | 7,900 |
During the year, credit sales were $1,173,000 and collections on account were $1,150,000.
The following transactions, among others, occurred during the year:
Feb. 17 | Wrote off R. Lowells account, $3,600 . |
May 28 | Wrote off G. Boyds account, $2,400 . |
Oct. 13 | Received $600 from G. Boyd, who is in bankruptcy proceedings, in final |
settlement of the account written off on May 28. This amount is not included in the | |
$1,150,000 collections. | |
Dec. 15 | Wrote off K. Marshalls account, $1,500 . |
Dec. 31 | Adjusted the allowance for doubtful accounts to 0.8% of credit sales for the year. |
a. What is the amount of the Bad Debt Expense for the year? $Answer
b. Determine the ending balances of Accounts Receivable and Allowance for Doubtful Accounts using the above information. Enter all amounts as positive numbers.
Accounts Receivable | Answer
|
Allowance for Doubtful Accounts | Answer
|
c. What would appear on the balance sheet for the net realizable value of accounts receivable at December 31? $Answer
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started