Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Gomez, Inc. sells machinery and equipment to farmers. Most sales are on account On April 1, 2017, the company has a debit balance of $280,000

image text in transcribed
Gomez, Inc. sells machinery and equipment to farmers. Most sales are on account On April 1, 2017, the company has a debit balance of $280,000 in accounts receivable and a credit balance of $12,600 in the allowance for doubtlul accounts. During the second quarter (from April 1 through June 30, 2017), Gomez records the following activities: Total sales of $315,000 $5,000 are in cash, and the rest are on account Cash collections from customers for previous credit sales totaling $395,000 Write-offs of two accounts as uncollectible: one for $4,500 and one for $9,700. Based on historical averages and expectations about the economy going forward, Gomez calculates bad debt expense as 4.0% of credit sales during the period. Calculate the following amounts (enter whole numbers without a $): a. The bad debt expense for the quarter ended June 30, 2017 12,400 b. The balance of accounts receivable on June 30, 2017 I c. The balance of the allowance for doubtful accounts on June 30, 2017 d. The net accounts receivable balance on June 30, 2017

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

Margins Of Error In Accounting

Authors: D. Myddelton

1st Edition

0230219918, 9780230219915

More Books

Students also viewed these Accounting questions