Question 15 (Mandatory) (3.5 points)

As of 12/31 the cash balance in Ellery, Inc.'s books is $75,000. The bank statement, however, showed a balance of $100,000 as of the same date. The only reconciling items were deposits in transit of $15,000, interest earned of $225, a bank service charge of $115 and outstanding checks.

______________________________

Ellery Inc.'s Adjusted Bank Statement Balance is the following:

Question 15 options:

	$154,890
	$115,000
	$75,110
	$60,110
	$45,110

Question 16 (Mandatory) (3.5 points)

As of 12/31 the cash balance in Ellery, Inc.'s books is $75,000. The bank statement, however, showed a balance of $100,000 as of the same date. The only reconciling items were deposits in transit of $15,000, interest earned of $225, a bank service charge of $115 and outstanding checks.

______________________________

Ellery Inc.'s Adjusted Book Balance is the following:

Question 16 options:

	$75,340
	$85,110
	$75,110
	$74,660
	$75,225

Part 3: Accounts Receivable

Question 17 (Mandatory) (3 points)

The Accounts Receivable balance for Computer Co. is $70,000 as of December 31st. Before calculating and recording Bad Debt Expense for the year, the Allowance for Doubtful Accounts has a credit balance of $80.

Credit sales for the year were $65,000. In the past, 3% of net credit sales have proved uncollectible.

An aging of Computer Co.s Accounts Receivable results in a $2,000 estimate for the Allowance for Doubtful Accounts. There were no write-offs during the year.

______________________________

Assume Computer Co. uses the percent of sales method. Please provide the adjusting entry the Company would record to recognize Bad Debt Expense:

Question 17 options:

	Dr. Bad Debt Expense $1,950 Cr. Accounts Receivable $1,950
	Dr. Bad Debt Expense $1,950 Cr. Allowance for Uncollectible Accounts $1,950
	Dr. Bad Debt Expense $1,920 Cr. Allowance for Uncollectible Accounts $1,920
	Dr. Allowance for Uncollectible Accounts $1,950 Cr. Bad Debt Expense $1,950

Question 18 (Mandatory) (3 points)

The Accounts Receivable balance for Computer Co. is $70,000 as of December 31st. Before calculating and recording Bad Debt Expense for the year, the Allowance for Doubtful Accounts has a credit balance of $80.

Credit sales for the year were $65,000. In the past, 3% of net credit sales have proved uncollectible.

An aging of Computer Co.s Accounts Receivable results in a $2,000 estimate for the Allowance for Doubtful Accounts. There were no write-offs during the year.

______________________________

Assume Computer Co. uses the percent of sales method. What is the balance in the Allowance for Doubtful Accounts after Computer Co. records its adjustment entry relating to Bad Debt Expense?

Question 18 options:

	$2,030
	$1,950
	$1,920
	$2,000

Question 19 (Mandatory) (3 points)

The Accounts Receivable balance for Computer Co. is $70,000 as of December 31st. Before calculating and recording Bad Debt Expense for the year, the Allowance for Doubtful Accounts has a credit balance of $80.

Credit sales for the year were $65,000. In the past, 3% of net credit sales have proved uncollectible.

An aging of Computer Co.s Accounts Receivable results in a $2,000 estimate for the Allowance for Doubtful Accounts. There were no write-offs during the year.

______________________________

Assume Computer Co. uses the percent of sales method. What is Accounts Receivable, gross on its December 31st Balance Sheet?

Question 19 options:

	$67,970
	$68,050
	$68,000
	$70,000

Question 20 (Mandatory) (3 points)

The Accounts Receivable balance for Computer Co. is $70,000 as of December 31st. Before calculating and recording Bad Debt Expense for the year, the Allowance for Doubtful Accounts has a credit balance of $80.

Credit sales for the year were $65,000. In the past, 3% of net credit sales have proved uncollectible.

An aging of Computer Co.s Accounts Receivable results in a $2,000 estimate for the Allowance for Doubtful Accounts. There were no write-offs during the year.

______________________________

Assume Computer Co. uses the percent of sales method. What is Accounts Receivable, net on its December 31st Balance Sheet?

Question 20 options:

	$67,970
	$70,000
	$68,000
	$68,050

Question 21 (Mandatory) (3 points)

The Accounts Receivable balance for Computer Co. is $70,000 as of December 31st. Before calculating and recording Bad Debt Expense for the year, the Allowance for Doubtful Accounts has a credit balance of $80.

Credit sales for the year were $65,000. In the past, 3% of net credit sales have proved uncollectible.

An aging of Computer Co.s Accounts Receivable results in a $2,000 estimate for the Allowance for Doubtful Accounts. There were no write-offs during the year.

______________________________

Assume Computer Co. uses the percent of sales method. What is Bad Debt Expense on its Income Statement for the year ending December 31st?

Question 21 options:

	$1,920
	$2,030
	$1,950
	$2,000