Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

alpha company began its first year of operations on january 1, 2017 the general manger wants to consider which methods to use when accounting for

alpha company began its first year of operations on january 1, 2017 the general manger wants to consider which methods to use when accounting for uncollectible accounts. you have been tasked to prepared an analysis based on the following information

total credit sales $800,000

total cash sales $150,000

credit sale discount $15,000

credit sales returns $65,000

cash sales returns $5,000

the general manager states an expectation that of credit sales, 1.2% may result in being uncollectible. the following relates the FY 2017 unadjusted trial balance amount of accounts receivable along with estimated percentages based on an aging method and balances that consists of:

days outstanding amount estimated uncollectible

0-60 $120,000 1%

61-120 90,000 2%

over 120 100,000 5%

if the percent of account receivable method were to be used the general manager expects that a total of 3% would be uncollectible

one of alpha clients declared bankruptcy in sept and the bookkeeper wrote off that account with debit to the allowance for uncollectible account and a credit to the account receivable for the amount of $500.

calculate the values for FY2017

1 allowance for uncollectible accounts aging method

2 bad debts expense, aging method

3 allowance for uncollectible accounts, percent of net credit sales method

4 bad debts expense, percent of net credit sales method

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Computer Accounting

Authors: Donna Kay

14th Edition

007762453X, 9780077624538

More Books

Students also viewed these Accounting questions

Question

Define Management or What is Management?

Answered: 1 week ago

Question

What do you understand by MBO?

Answered: 1 week ago

Question

What is meant by planning or define planning?

Answered: 1 week ago

Question

Define span of management or define span of control ?

Answered: 1 week ago

Question

1. Background knowledge of the subject and

Answered: 1 week ago

Question

2. The purpose of the acquisition of the information.

Answered: 1 week ago