CarryIT Inc.

Trial Balance

12/31/2018

Debit

Credit

Cash

300,000

$

Accounts Receivable

600,000

Allowance for Doubtful Accounts

30,000

$

Inventory

1,200,000

Supplies

60,000

Equipment

1,550,000

Accumulated Deperciation - Equipment

220,000

Building

900,000

Accumulated Deperciation - Building

450,000

Land

300,000

Patent

1,500,000

Long-Term Investments

1,290,000

Accounts Payable

950,000

Salaries and Wages Payable

20,000

Mortgage Payable

700,000

Bonds Payable

2,000,000

Common Stock

0.05

$

30,000

APIC

840,000

Retained Earnings

2,250,000

Dividends

100,000

Sales Revenue

2,360,000

Sales Discounts

150,000

COGS

1,240,000

Selling Expenses

280,000

Administrative Expenses

340,000

Rent Revenue

60,000

Gain on Sale of Equipment

30,000

Income Tax Expense

130,000

9,940,000

$

9,940,000

$

Part 1

- Using the information from the above trial balance. Calculate the following (

show your calculations

):

Accounts Receivable (net)

Net Sales

Common Shares Outstanding

Part 2

HealthView Inc. the following account balances;

Accounts Receivable

6,350,000

$

Allowance for Doubtful Accounts

75,000

$

Note: Accounts have "norm" balances.

Note: HealthView Inc. uses the allowance method.

Management (and accounting) are concerned that the current economic crisis has significantly

impacted their customers ability to pay. The CFO has instructed the accounting department

to adjust the Allowance for Doubtful Accounts balance to equal

10%

of the gross

accounts receivable balance.

Required:

1.

Calculate the necessary adjustment amount (show your work).

2.

Prepare the necessary journal entry to adjust the Allowance for Doubtful Accounts balance.

3.

Calculate the Net Accounts Receivable balance (post the adjusting entry made in #2 above).