Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Problem 7-5 Presented below is information related to the Accounts Receivable accounts of Martinez Inc. during the current year 2017 1. An aging schedule of

image text in transcribedimage text in transcribedimage text in transcribed

Problem 7-5 Presented below is information related to the Accounts Receivable accounts of Martinez Inc. during the current year 2017 1. An aging schedule of the accounts receivable as of December 31, 2017, is as follows. %to Be Applied after Correction Is Made Age Net Debit Balance Under 60 days 60-90 days 91-120 days $171,300 136,500 39,300 19% 3% 6% $3,800 definitely uncollectible; estimated remainder uncollectible is 25% Over 120 days 22,300 $369,400 The $3,000 write-off of receivables is related to the 91-to-120 day category 2. The Accounts Receivable control account has a debit balance of $369,400 on December 31, 2017 3. Two entries were made in the Bad Debt Expense account during the year: (1) a debit on December 31 for the amount credited to Allowance for Doubtful Accounts, and (2) a credit for $3,000 on November 3, 2017, and a debit to Allowance for Doubtful Accounts because of a bankruptcy 4. Allowance for Doubtful Accounts is as follows for 2017. Allowance for Doubtful Accounts Nov. 3 Uncollectible accounts written off 3,000 Jan. Bginning balance 5% of $369,400 9,400 18,470 Dec. 31 5. A credit balance exists in the Accounts Receivable (60-90 days) of $4,400, which represents an advance on a sales contract. Assuming that the books have not been closed for 2017, make the necessary correcting entries. (Round answers to 0 decimal places, e.g. 5,275. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) DateAccount Titles and Explanation Debit Credit Dec. 31, 2017 To correct bad debt expense and write off accounts receivable) Dec. 31, 2017 (To reclassify credit balance in accounts receivable) Dec. 31, 2017 Dec. 31, 2017 To correct bad debt expense and write off accounts receivable) Dec. 31, 2017 To reclassify credit balance in accounts receivable) Dec. 31, 2017 To write off uncollectible accounts) Dec. 31, 2017 (To reduce allowance for doubtful account balance)

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

Software Quality Assurance A Guide For Developers And Auditors

Authors: Howard T. Garst Smith

1st Edition

1574910493, 978-1574910490

More Books

Students also viewed these Accounting questions

Question

4. Write goals down and regularly monitor progress.

Answered: 1 week ago