Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

help with both of these problems please E6-7 E6-12 -L06-2 Recording Bad Debt Expense Estimates and Write-offs Using the Percentage of Credit Sales Method During

help with both of these problems please
E6-7
E6-12 image text in transcribed
image text in transcribed
-L06-2 Recording Bad Debt Expense Estimates and Write-offs Using the Percentage of Credit Sales Method During the current year. Adams Assembly, Inc., recorded credit sales of $1,300,000. Based on prior experience, it estimates a l percent bad debt rate on credit sales. Required: Prepare journal entries for each transaction: a. On September 29 of the current year, an account receivable for $4,000 from March of the current year was determined to be uncollectible and was written off. b. The appropriate bad debt expense adjustment was recorded for the current year rent year E6-12 L06-2 Recording and Reporting a Bad Debt Estimate Using Aging Analysis Casilda Company 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, $50,000; (2) up to 180 days past due, $14,000; and (3) more than 180 days past due, $4,000. Experience has shown that for cach age group, the average loss rate on the amount of the receivables at year-end due to uncollectibility is (1) 3 percent, (2) 12 percent, and (3) 30 percent, respectively. At December 31. the end of the current year, the Allowance for Doubtful Accounts balance is $200 (credit) before the end-of-period adjusting entry is made it Sales Based on Required: 1. Prepare the appropriate bad debt expense adjusting entry for the current year. 2. Show how the various accounts related to accounts receivable should be shown on the December 31. current year, balance sheet

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_2

Step: 3

blur-text-image_3

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

Management And Cost Accounting

Authors: Mike Tayles, Colin Drury

11th Edition

147377361X, 978-1473773615

More Books

Students also viewed these Accounting questions

Question

11.1 Explain the strategic importance of total rewards.

Answered: 1 week ago

Question

11.3 Define pay equity and explain its importance today.

Answered: 1 week ago