E6-23 (Algo) Recording, Reporting, and Evaluating a Bad Debt Estimate Using Aging Analysis L06-2 Brown Cow Dairy uses the aging approach to estimate bad debt expense. The ending balance of each account receivable is aged on the basis of three time periods as follows: (1) not yet due, $17,500; (2) up to 120 days past due, $3,500; and (3) more than 120 days past due, $5,500. Experience has shown that for each age group, the average loss rate on the amount of the receivables at year-end due to uncollectibility is (1) 2 percent, (2) 12 percent, and (3) 30 percent, respectively. At December 31 (end of the current year), the Allowance for Doubtful Accounts balance is $800 (credit) before the end-of-period adjusting entry is made. Data during the current year follow: a. During December, an Account Receivable (Patty's Bake Shop) of $750 from a prior sale was determined to be uncollectible; therefore, it was written off immediately as a bad debt. b. On December 31 , the appropriate adjusting entry for the year was recorded. Required: 1. Give the required journal entries for the two items listed above. 2. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the income statement and balance sheet for the current year. Disregard income tax considerations. Complete this question by entering your answers in the tabs below. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the income statement for the current year. Disregard income tax considerations. E6-3 (Algo) Reporting Net Sales with Credit Sales, Sales Discounts, Sales Returns, and Credit Card Sales L06-1 The following transactions were selected from among those completed by Bennett Retailers in November and December: Nove-ber 20 Novenber 25 Novenber 28 Novenber 29 December 6 December 20 Sold 20 items of merchandise to Customer B at an invoice price of $5,800 (total); terms 2/10,n/30. Sold two items of merchandise to Customer C, who charged the $500 (total) sales price on her Visa credit card. Visa charges Bennett Retailers a 1 percent credit card fee. Sold 10 identical items of merchandise to Customer D at an invoice price of $9,900 (total); terms 2/10,n/30. Customer D returned one of the items purchased on the 28th; the item was defective and credit was given to the customer. Customer D paid the account balance in full. Customer B paid in full for the invoice of November 20. Required: Assume that Sales Returns and Allowances, Sales Discounts, and Credit Card Discounts are treated as contra-revenues; compute net sales for the two months ended December 31. Note: Do not round your intermediate calculations. Round your answer to the nearest whole dollar amount. E6-23 (Algo) Recording, Reporting, and Evaluating a Bad Debt Estimate Using Aging Analysis LO6-2 Brown Cow Dairy uses the aging approach to estimate bad debt expense. The ending balance of each account receivable is aged on the basis of three time periods as follows: (1) not yet due, $17,500; (2) up to 120 days past due, $3,500; and (3) more than 120 days past due, $5,500. Experience has shown that for each age group, the average loss rate on the amount of the receivables at year-end due to uncollectibility is (1) 2 percent, (2) 12 percent, and (3) 30 percent, respectively. At December 31 (end of the current year), the Allowance for Doubtful Accounts balance is $800 (credit) before the end-of-period adjusting entry is made. Data during the current year follow: a. During December, an Account Receivable (Patty's Bake Shop) of $750 from a prior sale was determined to be uncollectible; therefore, it was written off immediately as a bad debt. b. On December 31 , the appropriate adjusting entry for the year was recorded. Required: 1. Give the required journal entries for the two items listed above. 2. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the income statement and balance sheet for the current year. Disregard income tax considerations. Complete this question by entering your answers in the tabs below. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the balance sheet for the current year. Disregard income tax considerations. (Amounts to be deducted should be indicated by a minus sign.) E6-22 (Algo) Recording, Reporting, and Evaluating a Bad Debt Estimate Using the Percentage of Credit Sales Method LO6-2 During the current year, Bob's Ceramics Shop had sales revenue of $170,000, of which $71,000 was on credit. At the start of the current year, Accounts Receivable showed a $20,000 debit balance and the Allowance for Doubtful Accounts showed a $1,100 credit balance. Collections of accounts recelvable during the current year amounted to $60,000. Data during the current year follow: a. On December 31, an Account Receivable (Toby's Gift Shop) of $1,400 from a prior year was determined to be uncollectible; therefore, it was written off immediately as a bad debt. b. On December 31, on the basis of experience, a decision was made to continue the accounting policy of basing estimated bad debt losses on 2.5 percent of credit sales for the year. Required: 1. Prepare the required journal entries for the two items on December 31 , the end of the accounting period. 2. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the income statement and balance sheet for the current year. Disregard income tax considerations. Complete this question by entering your answers in the tabs below. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the income statement for the current year. Disregard income tax considerations. E6-4 (Algo) Determining the Effects of Credit Sales, Sales Discounts, Credit Card Sales, and Sales Returns and Allowances on Income Statement Categories LO6-1 Griffin Shoe Company records Sales Returns and Allowances, Sales Discounts, and Credit Card Discounts as contra-revenues. July 12 Sold merchandise to customer at factory store who charged the $700 purchase on her American Express card. American Express charges a 2 percent credit card fee. Cost of goods sold was $575. Juty 15 Sold merchandise to Customer T at an invoice price of $5,400; terms 3/10,n/30. Cost of goods sold was $2,700. July 20 Collected cash due from Customer T. July 21 Before paying for the order, a customer returned shoes with an invoice price of $1,100; cost of goods sold was $660. Complete the foliowing table by entering the amounts of the effects of each transaction, including the related cost of goods sold. Note: Indicate decreases with a minus sign. E6-28 (Algo) Preparing Bank Reconciliation and Entries and Reporting Cash L06-4 The September 30 bank statement for Bennett Company and the September ledger account for cash are summarized here: No outstanding checks and no deposits in transit were carried over from August; however, there are deposits in transit and checks outstanding at the end of September. Required: 1. Complete the following bank reconciliation. 2. Prepare the journal entries that should be made as the result of the bank reconciliation. 3. What should the balance in the Cash account be after the reconciliation entries? 4. What total amount of cash should the company report on the September 30 balance sheet? Complete this question by entering your answers in the tabs below. What total amount of cash should the company report on the September 30 balance sheet? E6-22 (Algo) Recording, Reporting, and Evaluating a Bad Debt Estimate Using the Percentage of Credit Sales Method LO6-2 During the current year, Bob's Ceramics Shop had sales revenue of $170,000, of which $71,000 was on credit. At the start of the current year, Accounts Receivable showed a $20,000 debit balance and the Allowance for Doubtful Accounts showed a $1,100 credit balance. Collections of accounts receivable during the current year amounted to $60,000. Data during the current year follow: a. On December 31, an Account Receivable (Toby's Gift Shop) of $1,400 from a prior year was determined to be uncollectible; therefore, it was written off immediately as a bad debt. b. On December 31, on the basis of experience, a decision was made to continue the accounting policy of basing estimated bad debt losses on 2.5 percent of credit sales for the year. Required: 1. Prepare the required journal entries for the two items on December 31, the end of the accounting period. 2. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the income statement and balance sheet for the current year. Disregard income tax considerations. Complete this question by entering your answers in the tabs below. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the balance sheet for the current year. Disregard income tax considerations. (Amounts to be deducted should be indicated by a minus sign.) E6-28 (Algo) Preparing Bank Reconciliation and Entries and Reporting Cash LO6-4 The September 30 bank statement for Bennett Company and the September ledger account for cash are summarized here: No outstanding checks and no deposits in transit were carried over from August; however, there are deposits in transit and checks outstanding at the end of September. Required: 1. Complete the following bank reconciliation. 2. Prepare the journal entries that should be made as the result of the bank reconciliation. 3. What should the balance in the Cash account be after the reconciliation entries? 4. What total amount of cash should the company report on the September 30 balance sheet? Complete this question by entering your answers in the tabs below. Complete the following bank reconcillation. E6-28 (Algo) Preparing Bank Reconciliation and Entries and Reporting Cash LO6-4 The September 30 bank statement for Bennett Company and the September ledger account for cash are summarized here: No outstanding checks and no deposits in transit were carried over from August however, there are deposits in transit and checks outstanding ot the end of September, Required: 1. Complete the following bank reconciliation. 2. Prepare the journal entries that should be made as the result of the bank reconciliation. 3. What should the balance in the Cash account be after the reconciliation entries? 4. What total amount of cash should the company report on the September 30 balance sheet? Complete this question by entering your answers in the tabs below. Prepare the journal entries that should be made as the result of the bank reconciliotion. (If no entry is required for a transaction/evenc. select "No foumal entry required" in the first account field.) Journal entry worksheet Record the entry for checks cleared during September. Note: thiter debits before credits. E6-23 (Algo) Recording, Reporting, and Evaluating a Bad Debt Estimate Using Aging Analysis LO6-2 Brown Cow Dairy uses the aging approach to estimate bad debt expense. The ending balance of each account receivable is aged on the basis of three time periods as follows: (1) not yet due, $17,500; (2) up to 120 days past due, $3,500; and (3) more than 120 days past. due, $5,500. Experience has shown that for each age group, the average loss rate on the amount of the recelvables at year-end due to uncollectibility is (1) 2 percent, (2) 12 percent, and (3) 30 percent, respectively. At December 31 (end of the current year), the Allowance for Doubtful Accounts balance is $800 (credit) before the end-of-period adjusting entry is made. Data during the current year follow: a. During December, an Account Recelvable (Patty's Bake Shop) of $750 from a prior sale was determined to be uncollectible; therefore, it was written off immediately as a bad debt. b. On December 31 , the appropriate adjusting entry for the year was recorded. Required: 1. Give the required journal entries for the two items listed above. 2. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the income statement and balance sheet for the current year. Disregard income tax considerations. Complete this question by entering your answers in the tabs below. Give the required journal entries for the two items listed above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet Record the $750 account receivable from a prior sale, that was determined to be uncollectible. Nete: Enter debits befare credits. E6-28 (Algo) Preparing Bank Reconciliation and Entries and Reporting Cash L06-4 The September 30 bank statement for Bennett Company and the September ledger account for cash are summarized here: No outstanding checks and no deposits in transit were carried over from August; however, there are deposits in transit and checks outstanding at the end of September. Required: 1. Complete the following bank reconciliation. 2. Prepare the journal entries that should be made as the result of the bank reconciliation. 3. What should the balance in the Cash account be after the reconciliation entries? 4. What total amount of cash should the company report on the September 30 balance sheet? Complete this question by entering your answers in the tabs below. What should the balance in the Cash account be after the reconciliation entries? E6-22 (Algo) Recording, Reporting, and Evaluating a Bad Debt Estimate Using the Percentage of Credit Sales Method LO6-2 During the current year, Bob's Ceramics Shop had sales revenue of $170,000, of which $7,000 was on credit. At the start of the current year, Accounts Receivable showed a $20,000 debit balance and the Allowance for Doubtul Accounts showed a $1,100 credit balance. Collections of accounts receivable during the current year amounted to $60,000. Data during the current year follow: a. On December 31, an Account Receivable (Toby's Git Shop) of $1,400 from a prior year was determined to be uncollectible: therefore, it was written off immediately as a bad debt. b. On December 31, on the basis of experience, a decision was made to continue the accounting policy of basing estimated bad debt losses on 2.5 percent of credit sales for the year. Required: 1. Prepare the required journal entries for the two items on December 3t, the end of the accounting period. 2. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the income statement and balance sheet for the current year. Disregard income tax considerations. Complete this question by entering your answers in the tabs below. Prepare the required journal entries for the two items on December 31 , the end of the accounting period. (ar no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Journal entry worksheet On December 31, an Account Recelvable (Toby's Gitt Shop) of $1,400 from a prior year was determined to be uncollectible; therefore, it was written off immediately as a bad debt. Note: Enter debits before credes