Question
Entries Related to Uncollectible Accounts The following transactions were completed by The Wild Trout Gallery during the current fiscal year ended December 31: Jan. 19
Entries Related to Uncollectible Accounts
The following transactions were completed by The Wild Trout Gallery during the current fiscal year ended December 31:
Jan. | 19 | Reinstated the account of Arlene Gurley, which had been written off in the preceding year as uncollectible. Journalized the receipt of $1,590 cash in full payment of Arlenes account. |
Apr. | 3 | Wrote off the $9,110 balance owed by Premier GS Co., which is bankrupt. |
July | 16 | Received 40% of the $16,300 balance owed by Hayden Co., a bankrupt business, and wrote off the remainder as uncollectible. |
Nov. | 23 | Reinstated the account of Harry Carr, which had been written off two years earlier as uncollectible. Recorded the receipt of $2,590 cash in full payment. |
Dec. | 31 | Wrote off the following accounts as uncollectible (one entry): Cavey Co., $6,855; Fogle Co., $2,035; Lake Furniture, $5,230; Melinda Shryer, $1,480. |
31 | Based on an analysis of the $807,300 of accounts receivable, it was estimated that $35,100 will be uncollectible. Journalized the adjusting entry. |
Required:
1. Record the January 1 credit balance of $33,400 in a T account presented below in requirement 2b for Allowance for Doubtful Accounts.
Question Content Area
2. a. Journalize the transactions. If an amount box does not require an entry, leave it blank. Note: For the December 31 adjusting entry, assume the $807,300 balance in accounts receivable reflects the adjustments made during the year.
Jan. 19-reinstate | Accounts Receivable-Arlene GurleyAllowance for Doubtful AccountsBad Debt ExpenseInterest ReceivableSalesAccounts Receivable-Arlene Gurley | Accounts Receivable-Arlene Gurley | Accounts Receivable-Arlene Gurley |
Accounts Receivable-Arlene GurleyAllowance for Doubtful AccountsBad Debt ExpenseInterest ReceivableSalesAllowance for Doubtful Accounts | Allowance for Doubtful Accounts | Allowance for Doubtful Accounts | |
Jan. 19-collection | Accounts Receivable-Arlene GurleyAllowance for Doubtful AccountsBad Debt ExpenseCashSalesCash | Cash | Cash |
Accounts Receivable-Arlene GurleyAllowance for Doubtful AccountsBad Debt ExpenseCashSalesAccounts Receivable-Arlene Gurley | Accounts Receivable-Arlene Gurley | Accounts Receivable-Arlene Gurley | |
Apr. 3 | Accounts Receivable-Premier GS Co.Allowance for Doubtful AccountsBad Debt ExpenseNotes ReceivableSalesAllowance for Doubtful Accounts | Allowance for Doubtful Accounts | Allowance for Doubtful Accounts |
Accounts Receivable-Premier GS Co.Allowance for Doubtful AccountsBad Debt ExpenseNotes ReceivableSalesAccounts Receivable-Premier GS Co. | Accounts Receivable-Premier GS Co. | Accounts Receivable-Premier GS Co. | |
July 16 | Accounts Payable-Hayden Co.Accounts Receivable-Hayden Co.CashNotes ReceivableSalesCash | Cash | Cash |
Accounts Receivable-Hayden Co.Allowance for Doubtful AccountsInterest ReceivableNotes ReceivableSalesAllowance for Doubtful Accounts | Allowance for Doubtful Accounts | Allowance for Doubtful Accounts | |
Accounts Receivable-Hayden Co.Allowance for Doubtful AccountsCashNotes ReceivableSalesAccounts Receivable-Hayden Co. | Accounts Receivable-Hayden Co. | Accounts Receivable-Hayden Co. | |
Nov. 23-reinstate | Accounts Receivable-Harry CarrAllowance for Doubtful AccountsCashInterest ReceivableSalesAccounts Receivable-Harry Carr | Accounts Receivable-Harry Carr | Accounts Receivable-Harry Carr |
Accounts Receivable-Harry CarrAllowance for Doubtful AccountsCashInterest ReceivableSalesAllowance for Doubtful Accounts | Allowance for Doubtful Accounts | Allowance for Doubtful Accounts | |
Nov. 23-collection | Accounts Receivable-Harry CarrAllowance for Doubtful AccountsCashInterest ReceivableSalesCash | Cash | Cash |
Accounts Receivable-Harry CarrAllowance for Doubtful AccountsCashInterest ReceivableSalesAccounts Receivable-Harry Carr | Accounts Receivable-Harry Carr | Accounts Receivable-Harry Carr | |
Dec. 31-write-off | Allowance for Doubtful AccountsBad Debt ExpenseCashInterest ExpenseSalesAllowance for Doubtful Accounts | Allowance for Doubtful Accounts | Allowance for Doubtful Accounts |
Accounts Payable-Cavey Co.Accounts Receivable-Cavey Co.Allowance for Doubtful AccountsBad Debt ExpenseInterest RevenueAccounts Receivable-Cavey Co. | Accounts Receivable-Cavey Co. | Accounts Receivable-Cavey Co. | |
Accounts Payable-Fogle Co.Accounts Receivable-Fogle Co.Allowance for Doubtful AccountsBad Debt ExpenseCashAccounts Receivable-Fogle Co. | Accounts Receivable-Fogle Co. | Accounts Receivable-Fogle Co. | |
Accounts Payable-Lake FurnitureAccounts Receivable-Lake FurnitureAllowance for Doubtful AccountsCashSalesAccounts Receivable-Lake Furniture | Accounts Receivable-Lake Furniture | Accounts Receivable-Lake Furniture | |
Accounts Payable-Melinda ShryerAccounts Receivable-Melinda ShryerAllowance for Doubtful AccountsCashSalesAccounts Receivable-Melinda Shryer | Accounts Receivable-Melinda Shryer | Accounts Receivable-Melinda Shryer | |
Dec. 31-adjusting | Accounts PayableAccounts ReceivableAllowance for Doubtful AccountsBad Debt ExpenseInterest ReceivableBad Debt Expense | Bad Debt Expense | Bad Debt Expense |
Accounts PayableAccounts ReceivableAllowance for Doubtful AccountsBad Debt ExpenseInterest ReceivableAllowance for Doubtful Accounts | Allowance for Doubtful Accounts | Allowance for Doubtful Accounts |
Question Content Area
2. b. Post each entry that affects the following T accounts and determine the new balances:
Allowance for Doubtful Accounts | |||
---|---|---|---|
Jan. 19Apr. 3Nov. 23Apr. 3 | fill in the blank 37d7ea0ca014fca_2 | Jan. 1 Balance | fill in the blank 37d7ea0ca014fca_3 |
Jan. 19July 16Nov. 23July 16 | fill in the blank 37d7ea0ca014fca_5 | Jan. 19July 16Dec. 31Jan. 19 | fill in the blank 37d7ea0ca014fca_7 |
Jan. 19Nov. 29Dec. 31Dec. 31 | fill in the blank 37d7ea0ca014fca_9 | Apr. 3July 16Nov. 23Nov. 23 | fill in the blank 37d7ea0ca014fca_11 |
July 16Nov. 23Dec. 31 Unadjusted BalanceDec. 31 Unadjusted Balance | fill in the blank 37d7ea0ca014fca_13 | ||
Apr. 3July 16Dec. 31 Adjusting EntryDec. 31 Adjusting Entry | fill in the blank 37d7ea0ca014fca_15 | ||
Dec. 31 Adjusted Balance | fill in the blank 37d7ea0ca014fca_16 |
Bad Debt Expense | |||
---|---|---|---|
Dec. 31 Adjusting EntryDec. 31 Unadjusted BalanceDec. 31 Adjusting Entry | fill in the blank 37d7ea0ca014fca_18 |
Question Content Area
3. Determine the expected net realizable value of the accounts receivable as of December 31 (after all of the adjustments and the adjusting entry). $fill in the blank ff41290b3fa5fd3_1
4. Assuming that instead of basing the provision for uncollectible accounts on an analysis of receivables, the adjusting entry on December 31 had been based on an estimated expense of of 1% of the sales of $4,980,000 for the year, determine the following:
a. Bad debt expense for the year. $fill in the blank ff41290b3fa5fd3_2
b. Balance in the allowance account after the adjustment of December 31. $fill in the blank ff41290b3fa5fd3_3
c. Expected net realizable value of the accounts receivable as of December 31 (after all of the adjustments and the adjusting entry). $fill in the blank ff41290b3fa5fd3_4
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