Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following transactions occurred over the months of September to December at Nicole's Getaway Spa (NGS). September Sold spa merchandise to Ashley Welch Beauty for

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
The following transactions occurred over the months of September to December at Nicole's Getaway Spa (NGS). September Sold spa merchandise to Ashley Welch Beauty for $2,200 on account; the cost of these goods to NGS was $1.060. October Sold merchandise to Kelly Pant Nail Gallery for $610 on account; the cost of these goods to NGS was $280. November Sold merchandise to Raea Gooding Wellness for $460 on account the cost of these goods to NGS was $270. December Received $1,440 from Ashley Welch Beauty for payment on its account. Required: 1. Prepare journal entries for each of the transactions. Assume a perpetual inventory system. 2. Estimate the Allowance for Doubtful Accounts required at December 31, assuming the only receivables outstanding at December 31 arise from the transactions listed above. NGS uses the aging of accounts receivable method with the following uncollectible rates: one month, 1%; two months, 5%, three months, 20%; more than three months, 40% 3. The Allowance for Doubtful Accounts balance was $55 (credit) before the end-of-period adjusting entry is made. Prepare the journal entry to account for the Bad Debt Expense. 4. Assume the end of the previous year showed net accounts receivable of $880, and net sales for the current year are $9,800. Calculate the accounts receivable turnover ratio. 5. Audrey's Mineral Spa has an accounts receivable turnover ratio of 12.0 times. How does NGS compare to this competitor? Check my work Required 1 Required 2 Required 3 Required 4 Required 5 Estimate the Allowance for Doubtful Accounts required at December 31, assuming the only receivables outstanding at December 31 arise from the transactions listed above. NGS uses the aging of accounts receivable method with the followin funcollectible rates: one month, 1%; two months, 5%; three months, 20%, more than three months, 40%. Estimated Uncollectible One Month Two Months Three Months More than Three Months Total $ 0 Required 1 Required 2 Required 3 Required 4 Required 5 The Allowance for Doubtful Accounts balance was $55 (credit) before the end-of-period adjusting entry is made. Preparet entry to account for the Bad Debt Expense. (If no entry is required for a transaction/event, select "No Journal Entry Requl account field.) View transaction list Journal entry worksheet > Required 1 Required 2 Required 3 Required 4 Required 5 Audrey's Mineral Spa has an accounts receivable turnover ratio of 12.0 times. How does NGS compare to this competitor Nicole's Getaway Spa is in collecting receivable from customer than its competitor

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

Between The Lines Of The Balance Sheet The Plain Mans Guide To Published Accounts

Authors: Michael Greener

2nd Edition

0080240712, 9780080240718

More Books

Students also viewed these Accounting questions

Question

Discuss the effectiveness of a national infrastructure for HRD

Answered: 1 week ago