Question
I have the excel worksheet. It is to much to put in this 1 question so please just do it in order so i can
I have the excel worksheet. It is to much to put in this 1 question so please just do it in order so i can review and put on the excel worksheet.
II. Accounts receivable
- Assignment
Tailor Company has accounts receivable of $200,000 and an existing allowance for bad debts of $6,000. Tailor assigns the accounts to First Financial to secure a $150,000 loan. The Bank will charge a 2% of accounts assigned initial fee and will charge a 1% per month interest charge on average accounts outstanding. Tailor customers will make payments directly to First Financial.
In the following month, $80,000 of accounts were collected, $3,000 were written off as uncollectible and sales returns were $2,000
Using the above facts, complete the Excel worksheet for assignment.
Factoring
Tailor Company has accounts receivable of $200,000 and an existing allowance for bad debts of $6,000. Tailor factors the accounts to Second Bank with limited recourse. The Bank will charge a 5% factoring fee and requires a deposit to cover receivables reductions of 4%
In the following month, $80,000 of accounts were collected, $3,000 were written off as uncollectible and sales returns were $2,300
Using the above facts, complete the Excel worksheet for factoring.
B. Bad Debts
Here is the information about the allowance for bad debts account for 2014:
Beginning balance $ 5,000
Write off of bad debts $ 3,000
Bad debt expense, 2% of sales $24,000
At year end the auditor did an aging schedule that required an allowance of $28,000.
Required:
The final, adjusted bad debt expense for 2014: Provide calculations on Excel worksheet.
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