Accounts Receivable, Notes Receivable

Beginning Balance in Accounts Receivable: $15,000

Beginning Balance in Allowance for Uncollectible Accounts is a debit of $120

You will need to prepare a t-account for accounts receivable and allowance for uncollectible (doubtful) accounts. Use a 360-day year to calculate interest.

1. Adjust the allowance for uncollectible accounts assuming that 10% of the balance accounts receivable will be written off in the coming year.

2. Derrick sends a note via carrier pigeon stating he will not be able to pay off his account. Write off the $270 account using the allowance method.

3. Archie audits Merediths accounting records for $2,000. is paid in cash and the remainder put on account.

4. Torres calls and requests an extension on her accounts receivable. Her $5,000 account is transferred to a notes receivable with terms of 10% and 90 days.

5. Cristina dishonors her note receivable of $3,000. Terms were 60 days and 5% interest. Charge back to accounts receivable.

6. Alex brings $900 in cash by the office to pay his bill.

7. Derrick sends a check for $50.

8. Meredith pays $500 of the $1,000 she owes and the remaining $500 is put on a 30 day 15% note.

9. Adjustment: Recognize 30 days of the note in #4 and 15 days of the note in #8.

10. Cristina pays her account in full.

11. The bank sends a note stating Alexs cash was counterfeit. Put back on his account.

12. Meredith dishonors her note. Write off the account.

13. Write off Alexs account.

14. Based on the ending balance of accounts receivable, assume that 5% will be written off in the coming year and update the allowance account to reflect this amount.