Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Chapter 8 Work Problems eBook Aging of receivables; estimating allowance for doubtful accounts Instructions Chart of Accounts Starting Question Aging of Receivables Schedule Instructions x

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

Chapter 8 Work Problems eBook Aging of receivables; estimating allowance for doubtful accounts Instructions Chart of Accounts Starting Question Aging of Receivables Schedule Instructions x Trophy Fish Company supplies flies and fishing gear to sporting goods stores and outfitters throughout the western United States. The accounts receivable clerk for Trophy Fish prepared the following partially completed aging of receivables schedule as of the end of business on December 31, 2014 1 Not Days Past Due Days Past Due Days Past Due Days Past Due Days Past Due 2 Past 3 Customer Balance Due 1-30 31-60 61-90 91-120 Over 120 4 AAA Outfitters 20,500.00 20,500.00 5 Brown Trout Fly Shop 7.600.00 7.600.00 6 - 7 3 Zigs Fish Adventures 3,900.00 5,900.00 9 Subtotals 1.319,300.00 758,200.00 299,000.00 129,300.00 36,900.00 17,400.00 78,500.00 Aging of receivables; estimating allowance for doubtful accounts Instructions Chart of Accounts Starting Question Aging of Receivables Schedule Instructions The following accounts were unintentionally omitted from the aging schedule. Assume all due dates are for the current year except for Wolfe Sports, which is due in the next year Customer Due Date Balance Adams Sports & Flies May 22 $4,800 Blue Dun Flies Oct 10 4.700 Cicada Fish Co Sept. 29 8,600 Deschutes Sports Oct 20 7,000 Green River Sports Nov. 7 3.500 Smith River Co. Nov. 28 2,200 Westem Trout Company Dec. 7 6.900 Wolfe Sports Jan. 20 4,200 Trophy Fish has a past history of uncollectible accounts by age category, as follows: Age Class Percent Uncollectible Not past due 1% 1-30 days past due 2 Aging of receivables; estimating allowance for doubtful accounts instructions Chart of Accounts Starting Question Aging of Receivables Schedule Instructions Trophy Fish has a past history of uncollectible accounts by age category, as follows: Age Class Percent Uncollectible Not past due 1% 1-30 days past due 2 31-60 days past due 12 61-90 days past due 28 91-120 days past due 41 Over 120 days past due 84 1. Determine the number of days past due for each of the preceding accounts if an account is not past due, enter a zero. 2. Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals. 3. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule 4. Assume that the allowance for doubtful accounts for Trophy Fish Company has a debit balance of $3,500 before adjustment on December 31 Journalize the adjusting entry for uncollectible accounts. Refer to the Chart of Accounts for exact wording of account titles. 5. Assume that the adjusting entry in (4) was inadvertently omitted, how would the omission affect the balance sheet and income statement? CHART OF ACCOUNTS Trophy Fish Company General Ledger ASSETS REVENUE 110 Cash 410 Sales 111 Petty Cash 610 Interest Revenue 121 Accounts Receivable-Adams Sports & Flies 122 Accounts Receivable-Blue Dun Flies EXPENSES 123 Accounts Receivable Cicada Fish Co. 510 Cost of Goods Sold 124 Accounts Receivable-Deschutes Sports 520 Sales Salaries Expense 125 Accounts Receivable-Green River Sports 126 Accounts Receivable-Smith River Co. 521 Advertising Expense 522 Depreciation Expense-Store Equipment 523 Delivery Expense 127 Accounts Receivable-Western Trout Company 128 Accounts Receivable-Wolfe Sports 524 Repairs Expense 129 Allowance for Doubtful Accounts 529 Selling Expenses COUNTS 131 Interest Receivable 530 Office Salaries Expense 132 Notes Receivable 531 Rent Expense 141 Merchandise Inventory 532 Depreciation Expense-Office Equipment 145 Office Supplies 146 Store Supplies 533 Insurance Expense 151 Prepaid Insurance 534 Office Supplies Expense 535 Store Supplies Expense 181 Land 536 Credit Card Expense 191 Store Equipment 537 Cash Short and Over 538 Bad Debt Expense 192 Accumulated Depreciation-Store Equipment 193 Office Equipment 194 Accumulated Depreciation Office Equipment 539 Miscellaneous Expense 710 Interest Expense LIABILITIES 210 Accounts Payable 211 Salaries Payable 213 Sales Tax Payable 214 Interest Payable LIABILITIES 210 Accounts Payable 211 Salaries Payable 213 Sales Tax Payable 214 Interest Payable 215 Notes Payable EQUITY 310 Common Stock 311 Retained Earnings 312 Dividends 1. Determine the number of days past due for each of the accounts below. If an account is not past due enter a zero. Customer Due Date Number of Days Past Due Adams Sports & Flies May 22, 20Y4 days Blue Dun Flies Oct 10, 2014 days Cicada Fish Co. Sept 29, 2014 days Deschutes Sports Oct. 20, 2014 days Green River Sports Nov. 7, 2014 days Smith River Co. Nov. 28, 2014 days Western Trout Company Dec. 7. 2014 days Wolfe Sports Jan 20, 2045 days Aging of Receivables Schedule 2. Complete the aging of receivables schedule by adding the omitted accounts to the bottom of the schedule and updating the totals. If an amount box does not require an en leave it blank Aging of Receivables Schedule December 31, 20Y4 Days Past Due Days Past Due Days Past Due Days Past Due Days Past Due 2 Customer Balance Not Past Due 1-30 31-60 61-90 91-120 Over 120 3 AAA Outfitters 20,500.00 20,500.00 4 Brown Trout Fly Shop 7,600.00 7,600.00 5 - 6 Zigs Fish Adventures 3,900.00 3,900.00 2 Subtotals 1,319,300.00 758,200.00 299,000.00 129,300.00 36,900.00 17.400.00 78,500.00 8 Adams Sports & Flies 9 Blue Dun Flies 10 Cicada Fish Co. Aging of Receivables Schedule 7 Subtotals 1,319,300.00 758,200.00 299,000.00 129,300.00 36,900.00 17.400.00 78,500.00 8 Adams Sports & Flies 9 Blue Dun Flies 10 Cicada Fish Co. 11 Deschutes Sports 12 Green River Sports 15 Smith River Co. Western Trout 14 Company 15 Wolfe Sports 16 Totals 17 Percentage uncollectible Estimate of 18 uncollectible accounts Additional Question 3. Estimate the allowance for doubtful accounts, based on the aging of receivables schedule. $ Aging of receivables; estimating allowance for doubtful accounts Instructions Chart of Accounts Starting Question Aging of Receivables Schedule Additional Question Journal 4. Assume that the allowance for doubtful accounts for Trophy Fish Company has a debit balance of $3,500 before adjustment on December 31. Journalize the adjusting entry for uncollectible accounts. Refer to the Chart of Accounts for exact wording of account titles PAGE 10 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 2 Aging of receivables; estimating allowance for doubtful accounts Instructions Chart of Accounts Starting Question Aging of Receivables Schedule Final Question 5. Assume that the adjusting entry in (4) was inadvertently omitted, how would the omission affect the balance sheet and income statement? in because the allowance for doubtful accounts would be On the balance sheet assets would be addition, the owner's capital account would be by because bad debt expense would be and net income by on the income statement

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

Accounting Chapters 14-23

Authors: Charles T. Horngren, Walter T. Harrison Jr, M. Suzanne Oliver

8th Edition

0136073018, 978-0136073017

More Books

Students also viewed these Accounting questions

Question

Roll out international HRM practices for franchisees.

Answered: 1 week ago