Question 1

Alpha Company used the percentage of sales method, with an historical rate of 2% for determining their bad debt expense. During 2016, sales were $1,600,000, and the January 1 Allowance for Doubtful Accounts had a normal balance of $15,000.$17,500 of accounts were written off during the year.What are the year end dollar amounts for:

1. Charged to the Bad Debt Expense account
2. Balance for Allowance for Doubtful Accounts

Question 6 (6 points)

Alpha Company has the following account balances information for fiscal year 2015 & 2016 (all balances are normal):

Alpha Company

December 31

Accounts

2016

2015

Accounts Receivable

$50,000

$45,000

Merchandise Inventory

57,000

50,000

Office Supplies

25,000

20,000

Credit Sales

1,000,000

740,000

Interest Income

25,000

20,000

Cost of Goods Sold

460,000

385,000

1. What is the FY 2016 accounts receivable turnover ratio? Enter the answer as a number rounded to one decimal place followed by a space and the word times. (Example 1.123 would be entered 1.1 times)

2. What is the FY 2016 days outstanding for accounts receivable ratio? Enter the answer as a number rounded to one decimal place followed by a space and the word days. (Example 1.123 would be entered 1.1 days)