Chapter 5 Homework Fall 2021 ALT Problem One: Blocker Company estimates its uncollectible accounts based on an analysis of receivables. On December 31, a junior accountant prepared the following aging schedule for the company's $88,000 in outstanding receivables. Estimated Uncollectible Amount $57,650 14,220 Are Interval Not Due 1-30 days past due 31-60 days past doe 63-90 days puit die Over 90 days past due Total 7,930 2% 4 20% 30% SOK 5,000 2,200 $88,000 The Allowance for Uncollectible Accounts currently has a $310 debit balance 1 Prepare the adjusting entry to record the company's estimate of uncollectible accounts NI Account DR Date CR 2. Prepare the journal entry to write off the following accounts T. Donaldion $ 750 Kyle 470 D. Mice 1,000 Date HE E ALOM DR CH 3. Prepare the journal entry to record receipt of the S470 owed by). Kyle. Date A L SE R E NI OF Account DR CR 4. Write an answer to the following question: What circumstances would cause the Allowance for doubtful Accounts to have a debit balance prior to adjustment? Problem Two: A company has the following balances on December 31, Year 1, before any adjustments Accounts Receivable - $47,000, Allowance for Uncollectible Accounts = $1,100 (credit). On December 31, Year 1, the company estimates uncollectible accounts to be 15% of accounts receivable Required: 1. Record the adjusting entry for uncollectible accounts on December 31, Year 1. Date A L SE R NI CF Account DR CR 2. Determine the amount at which bad debe expense is reported in the income statement, and the amount of the allowance for uncollectible accounts and net accounts receivable, as reported in the balance sheet. Bad Debt Expense Allowance for Uncollectible Accounts Net Accounts Receivable Problem Three: A company reports the following amounts at the end of Year 1 (before adjustment). Credit Sales for Year 1 Accounts Receivable, December 31, Year 1 Allowance for Uncollectible Accounts, December 31, Year 1 $254,000 49,000 1,100 (Credit) 1. Record the adjusting entry for uncollectible accounts using the percentage of receivables method. The company estimates 12% of receivables will not be collected NI CF Account DR OR Date SE 2. Record the adjusting entry for uncollectible accounts using the percentage-of-credit-sales method. The company estimates 3% of credit sales will not be collected Date SE NI Account DA CR TT Problem Four: You are given the folowing information related to XYZ Corporation: Account Classification (ALSE,RE Indicatif contract Nosal Balance (DR CR) Financial Statement (BS or 15) Listed in alphabetical order: Accounts Receivable $300,000 Allowance for Uncollectible Accounts $30,000 Bad Debt Expense $40,000 Sales Allowances $10,000 Sales Discounts $25,000 Sales Returns $40,000 Sales Revenue $1,000,000 A) What was Net Sales? Show computation What was Net Accounts Pecelable? Show computation C) Compute Accounts Receivable Turnover Ratio Astume average accounts receivable is $250,000. Show computation: Unrelated to any of the above items, if Accounts Receivable Turnover Ratio was 9 last year and 10 this year, which year had better collection results? Explain