when using the allowance method, how are accounts receivable shown on the bal 13. When using ance sheet? when using the allowance method, what account is debited when writing off unco lectible accounts? How does this differ from the direct write-off method? When a receivable is written off under the allowance method, how does it affect the net realizable value shown on the balance sheet? 16. How does the percent-of-sales method compute bad debts expense? 17. How do the percent-of-receivables and aging-of-receivables methods compute bad debts expense? C h ler and aging-of-receivables Garden Greenhouse uses the direct write-off memnu. Eive 3 $9-5 Applying the allowance method to account for uncollectibles The Accounts Receivable balance and Allowance for Bad Debts for Signature Company at December 31, 2017, was $10,800 and $2,000 (credit balance), respecti During 2018, Signature Lamp Company completed the following transactions: a. Sales revenue on account, $273,400 (ignore Cost of Goods Sold). b. Collections on account, $223,000. c. Write-offs of uncollectibles, $5,900. d. Bad debts expense of $5,200 was recorded. Requirements 1. Journalize Signature Lamp Company's transactions for 2018 ing Sugat Lamp Company uses the allowance method Post the transactions to the Accounts Receivable Al for Bad Debes, and Bad Debts Expense T-accounts, and determine the ending balance of each account Show how accounts receivable would be reported on the balance sheet December 31, 2018 06 Applying the allowance method (percent-of-sales) to account for uncollectibles During its first year of operations, Fall Wine Tour earned net credit sales of $311.000 Industry experience suggests that bad debts will amount to 3% of niet credit sales At December 31, 2018, accounts receivable total $44.000. The company uses the allowance method to account for uncollectibles Requirements 1. Journalize Fall Wine Tour's Bad Debts Expense using the percent of sales method. 2. Show how to report accounts receivable on the balance sheet December 31, 2018. Lear 59-7 Applying the allowance method (percent-of-receivables) to account for uncollectibles The Accounts Receivable balance for Lake Company at December 31, 2017, was $20,000. During 2018, Lake earned revenue of $454,000 on account and collected $325,000 on account. Lake wrote off $5,600 receivables as uncollectible Industry experience suggests that uncollectible accounts will amount to 5% of accounts receivable. Requirements 1. Assume Lake had an unadjusted $2,700 credit balance in Allowance for Bad Debes at December 31, 2018. Journalize Lakes December 31, 2018, adjustment to record bad debts expense using the percent-of-receivables method. 2. Assume Lake had an unadjusted $2,400 debit balance in Allowance for Bad Debts at December 31, 2018. Journalize Lake's December 31, 2018, adjustment to record bad debts expense using the percent of receivables method. S9-8 Applying the allowance method (aging-of-receivables) to account for uncollectibles Surf and Sun had the following balances at December 31, 2018, before the year-end adjustments: Accounts Receivable Allowance for Bad Debts 81,000 2,063 The aging of accounts receivable yields the following data: Age of Accounts Receivable 0-60 Days Over 60 Days Total Receivables $3,000 $ 78,000 $81,000 Accounts Receivable x2 x 23% Estimated percent uncollectible E9-18 Account Accounting for uncollectible accounts using the allowance method (percent-of-sales) and reporting receivables on the balance sheet Requirements 1. Journalize Hilltop's transactions that occurred during 2018. The company uses the allowance method 2. Post Hilltop's transactions to the Accounts Receivable and Allowance for Bad Debts T-accounts. 3. Journalize Hilltop's adjustment to record bad debts expense assuming Hilltop estimates bad debts as 3% of credit sales. Post the adjustment to the appropriate T-accounts. 4. Show how Hilltop Flagpoles will report net accounts receivable on its December 31, 2018, balance sheet. E9-19 Accounting for uncollectible accounts using the allowance method (percent-of-receivables) and reporting receivables on the balance sheet Requirements 1. Journalize Hilltop's transactions that occurred during 2018. The company uses the allowance method. 2. Post Hilltop's transactions to the Accounts Receivable and Allowance for Bad Debts T-accounts. 3. Journalize Hilltop's adjustment to record bad debts expense assuming Hilltop esti- mates bad debts as 10% of accounts receivable. Post the adjustment to the appro- priate T-accounts. 4. Show how Hilltop Flagpoles will report net accounts receivable on its December 31, 2018, balance sheet. CY-20 Accounting for uncollectible accounts using the allowance method (aging-of-receivables) and reporting receivables on the balance sheet At December 31, 2018, the Accounts Receivable balance of GPS Technology is $200,000. The Allowance for Bad Debts account has a $24,110 debit balance. GPS Technology prepares the following aging schedule for its accounts receivable: Age of Accounts 31-60 Days 61-90 Days Over 90 Days $50,000 $40,000 $ 45,000 3.0% 5.0% 48.0% 1-30 Days $ 65,000 0.4% Accounts Receivable stimated percent uncollectible when using the allowance method, how are accounts receivable shown on the bal 13. When using ance sheet? when using the allowance method, what account is debited when writing off unco lectible accounts? How does this differ from the direct write-off method? When a receivable is written off under the allowance method, how does it affect the net realizable value shown on the balance sheet? 16. How does the percent-of-sales method compute bad debts expense? 17. How do the percent-of-receivables and aging-of-receivables methods compute bad debts expense? C h ler and aging-of-receivables Garden Greenhouse uses the direct write-off memnu. Eive 3 $9-5 Applying the allowance method to account for uncollectibles The Accounts Receivable balance and Allowance for Bad Debts for Signature Company at December 31, 2017, was $10,800 and $2,000 (credit balance), respecti During 2018, Signature Lamp Company completed the following transactions: a. Sales revenue on account, $273,400 (ignore Cost of Goods Sold). b. Collections on account, $223,000. c. Write-offs of uncollectibles, $5,900. d. Bad debts expense of $5,200 was recorded. Requirements 1. Journalize Signature Lamp Company's transactions for 2018 ing Sugat Lamp Company uses the allowance method Post the transactions to the Accounts Receivable Al for Bad Debes, and Bad Debts Expense T-accounts, and determine the ending balance of each account Show how accounts receivable would be reported on the balance sheet December 31, 2018 06 Applying the allowance method (percent-of-sales) to account for uncollectibles During its first year of operations, Fall Wine Tour earned net credit sales of $311.000 Industry experience suggests that bad debts will amount to 3% of niet credit sales At December 31, 2018, accounts receivable total $44.000. The company uses the allowance method to account for uncollectibles Requirements 1. Journalize Fall Wine Tour's Bad Debts Expense using the percent of sales method. 2. Show how to report accounts receivable on the balance sheet December 31, 2018. Lear 59-7 Applying the allowance method (percent-of-receivables) to account for uncollectibles The Accounts Receivable balance for Lake Company at December 31, 2017, was $20,000. During 2018, Lake earned revenue of $454,000 on account and collected $325,000 on account. Lake wrote off $5,600 receivables as uncollectible Industry experience suggests that uncollectible accounts will amount to 5% of accounts receivable. Requirements 1. Assume Lake had an unadjusted $2,700 credit balance in Allowance for Bad Debes at December 31, 2018. Journalize Lakes December 31, 2018, adjustment to record bad debts expense using the percent-of-receivables method. 2. Assume Lake had an unadjusted $2,400 debit balance in Allowance for Bad Debts at December 31, 2018. Journalize Lake's December 31, 2018, adjustment to record bad debts expense using the percent of receivables method. S9-8 Applying the allowance method (aging-of-receivables) to account for uncollectibles Surf and Sun had the following balances at December 31, 2018, before the year-end adjustments: Accounts Receivable Allowance for Bad Debts 81,000 2,063 The aging of accounts receivable yields the following data: Age of Accounts Receivable 0-60 Days Over 60 Days Total Receivables $3,000 $ 78,000 $81,000 Accounts Receivable x2 x 23% Estimated percent uncollectible E9-18 Account Accounting for uncollectible accounts using the allowance method (percent-of-sales) and reporting receivables on the balance sheet Requirements 1. Journalize Hilltop's transactions that occurred during 2018. The company uses the allowance method 2. Post Hilltop's transactions to the Accounts Receivable and Allowance for Bad Debts T-accounts. 3. Journalize Hilltop's adjustment to record bad debts expense assuming Hilltop estimates bad debts as 3% of credit sales. Post the adjustment to the appropriate T-accounts. 4. Show how Hilltop Flagpoles will report net accounts receivable on its December 31, 2018, balance sheet. E9-19 Accounting for uncollectible accounts using the allowance method (percent-of-receivables) and reporting receivables on the balance sheet Requirements 1. Journalize Hilltop's transactions that occurred during 2018. The company uses the allowance method. 2. Post Hilltop's transactions to the Accounts Receivable and Allowance for Bad Debts T-accounts. 3. Journalize Hilltop's adjustment to record bad debts expense assuming Hilltop esti- mates bad debts as 10% of accounts receivable. Post the adjustment to the appro- priate T-accounts. 4. Show how Hilltop Flagpoles will report net accounts receivable on its December 31, 2018, balance sheet. CY-20 Accounting for uncollectible accounts using the allowance method (aging-of-receivables) and reporting receivables on the balance sheet At December 31, 2018, the Accounts Receivable balance of GPS Technology is $200,000. The Allowance for Bad Debts account has a $24,110 debit balance. GPS Technology prepares the following aging schedule for its accounts receivable: Age of Accounts 31-60 Days 61-90 Days Over 90 Days $50,000 $40,000 $ 45,000 3.0% 5.0% 48.0% 1-30 Days $ 65,000 0.4% Accounts Receivable stimated percent uncollectible