The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period are as follows Number of Units Date Transaction Per Unit Total Apr. 3 Inventory 78 $ 225 $ 17,550 8 Purchase 156 270 42,120 11 Sale 105 750 78,750 30 Sale 66 750 49,500 39,000 May 8 Purchase 130 300 10 Sale 78 750 58,500 19 Sale 39 750 29,250 28 Purchase 130 330 42,900 June 5 Sale 78 790 61,620 16 Sale 104 790 82,160 21 Purchase 234 360 84,240 28 Sale 117 790 92,430 Instructions The following transactions were completed by Irvine Company during the current fiscal year ended December 31: Feb. 8 May 27 Aug. 13 Oct. 31 Received 35% of the $18,600 balance owed by Decoy Co., a bankrupt business, and wrote off the remainder as uncollectible. Reinstated the account of Seth Nelsen, which had been written off in the preceding year as uncollectible. Journalized the receipt of $7,445 cash in full payment of Seth's account. Wrote off the $6,375 balance owed by Kat Tracks Co., which has no assets. Reinstated the account of Crawford Co., which had been written off in the preceding year as uncollectible. Journalized the receipt of $3,840 cash in full payment of the account. Wrote off the following accounts as uncollectible (compound entry): Newbauer Co., 57,240; Bonneville Co., $5,575; Crow Distributors, 59,355; Fiber Optics, $1,035. Based on an analysis of the $1,768,000 of accounts receivable, it was estimated that $35,360 will be uncollectible. Journalized the adjusting entry. Dec. 31 Dec. 31 1. Record the January 1 credit balance of $26,195 in a T-account for Allowance for Doubtful Accounts. 2. A. Journalize the transactions. Refer to the Chart of Accounts for exact wording of account titles. B. Post each entry that affects the following selected T-accounts and determine the new balances: Allowance for Doubtful Accounts and Bad Debt Expense 3. Determine the expected net realizable value of the accounts receivable as of December 31 (after all of the adjustments and the adjusting entry) 4. Assuming that instead of basing the provision for uncollectible accounts on an analysis of receivables, the adjusting entry on December 31 had been based on an estimated expense of 14 of 1% of the net sales of $18,380,000 for the year, determine the following: A. Bad debt expense for the year. B. Balance in the allowance account after the adjustment of December 31. T-Accounts Shaded cells have feedback. X 1. Record the January 1 credit balance of $26,195 in a T-account for Allowance for Doubtful Accounts 2. B. Post each entry that affects the following selected T-accounts and determine the new balances: Allowance for Doubtful Accounts and Bad Debt Expense Allowance for Doubtful Accounts Feb. 8 12,090 Jan. 1 Balance 26,195 Aug. 13 6,375 May 27 7,445 Dec. 31 23,205 Oct. 31 3,840 Dec. 31 Adjusting Entry 39,550 Dec. 31 Unadjusted Balance 4.190 Dec. 31 Adj. Balance 35.360 V Bad Debt Expense Dec. 31 Adjusting Entry V 39,550 Points 18 / 18 3. Determine the expected net realizable value of the accounts receivable as of December 31 (after all of the adjustments and the adjusting entry) S JOURNAL Score: 242/249 ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. CREDIT ASSETS LIABILITIES EQUITY DEBIT 6,510.00 1 Feb. 8 Cash 1 Allowance for Doubtful Accounts 12,090.00 1 3 18,600.00 + Accounts Receivable-Decoy Co. May 27 Accounts Receivable-Seth Nelsen 4 7,445.00 5 Allowance for Doubtful Accounts 7,445.00 + 6 May 27 Cash 7,445.00 7 Accounts Receivable-Seth Nelsen 7,445.00 + 6,375.00 1 9 6,375.00 10 3,840.00 1. 3,840.00 + 12 25,205.00 13 Aug. 13 Allowance for Doubtful Accounts Accounts Receivable-Kat Tracks Co. Oct 31 Accounts Receivable-Crawford Co. Allowance for Doubtful Accounts Dec. 31. Allowance for Doubtful Accounts Accounts Receivable-Newbauer Co Accounts Receivable-Bonneville Co. Accounts Receivable-Crow Distributors Accounts Receivable-Fiber Optics Dec. 31 Bad Debt Expense Allowance for Doubtful Accounts + 7,240.00 5,575.00 + 15 9,355.00 1 16 1,035.00 17 39,550.00 18 39,550.00 19 Cash 77,050.00 20 Accounts Receivable-Crawford Co. 25,205.00