The accounts receivable balance for Renue Spa at December 31, Year 1, was $83,000. Also on that date, the balance in the Allowance for Doubtful Accounts was $2,100. Total retained earnings at the end of Year 1 was $80,900. During Year 2, $1,900 of accounts receivable were written off as uncollectible. In addition, Renue unexpectedly collected $130 of receivables that had been written off in a previous accounting period. Services provided on account during Year 2 were $215,000, and cash collections from receivables were $216,972. Uncollectible accounts expense was estimated to be 1 percent of the sales on account for the period.
Required
- Organize the information in accounts under an accounting equation.
- Based on the preceding information, compute (after year-end adjustment):
- (1) Balance of Allowance for Doubtful Accounts at December 31, Year 2.
- (2) Balance of Accounts Receivable at December 31, Year 2.
- (3) Net realizable value of Accounts Receivable at December 31, Year 2.
- What amount of uncollectible accounts expense will Renue Spa record for Year 2?
Module 2 Textbook Problems A Seved Help Save & Exit Submit Check my work 4 Problem: Module 2 Textbook Problem 4 Learning Objective: 2-2 Use the percent of revenue method to account for uncollectible accounts expense 0.5 points The accounts receivable balance for Renue Spa at December 31, Year 1, was $83,000. Also on that date, the balance in the Allowance for Doubtful Accounts was $2,100. Total retained earnings at the end of Year 1 was $80,900. During Year 2, $1,900 of accounts receivable were written off as uncollectible. In addition, Renue unexpectedly collected $130 of receivables that had been written off in a previous accounting period. Services provided on account during Year 2 were $215,000, and cash collections from receivables were $216,972. Uncollectible accounts expense was estimated to be 1 percent of the sales on account for the period. Hint Print Required a. Organize the information in accounts under an accounting equation. b. Based on the preceding information, compute (after year-end adjustment): 1. (1) Balance of Allowance for Doubtful Accounts at December 31, Year 2 2. (2) Balance of Accounts Receivable at December 31, Year 2. 3. (3) Net realizable value of Accounts Receivable at December 31, Year 2. c. What amount of uncollectible accounts expense will Renue Spa record for Year 2? Complete this question by entering your answers in the tabs below. Reg A Req B and C Organize the information in accounts under an accounting equation. (Enter any decreases to account balances with a minus sign. If Check my work 4 Complete this question by entering your answers in the tabs below. 0.5 points Req A Req B and C minus sign. If Organize the information in accounts under an accounting equation. (Enter any decreases to account balances with there is no effect on the Accounts Titles for Retained Earnings, leave the cell blank. Not all cells will require entry.) Hint Print Event + RENUE SPA Horizontal Statements Model Assets Equity NRV Accounts Liabilities Cash Retained + Receivable Earnings 0 + 80,900= 01 + + 80,900 01 + + 0 = + 130 + (130) = + Accounts Titles for Retained Earnings Bal. 1. + 2a. 2b. + = + 3. + + 1 + + + 4. + = 215,000 = 1 (216,972) = 78,798 = 5 + 216,972 + 217,102 + 215,000 Revenue Uncollectible accounts expense 295,900 Bal. 01 + CH 4 Complete this question by entering your answers in the tabs below. 0.5 points Req A Req B and C Hint Based on the preceding information, compute (after year-end adjustment): (1) Balance of Allowance for Doubtful Accounts at December 31, Year 2. (2) Balance of Accounts Receivable at December 31, Year 2. (3) Net realizable value of Accounts Receivable at December 31, Year 2. What amount of uncollectible accounts expense will Renue Spa record for Year 2? Print Show less b-1. Allowance for doubtful accounts b-2. Accounts receivable b-3. Net realizable value Uncollectible accounts expense C. Reg A Reg B and C >
