The sales, all on account, of Pins Company in 2013, its first year of operations, were $700,000. Collections totaled $500,000. On December 31, 2013, Pins Company estimated that 2% of all sales would probably be uncollectible. On that date, Pins Company wrote off specific accounts in the amount of $8,000.
The balances in selected accounts on December 31, 2014, are as follows:
Accounts Receivable, Gross (Dr.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $300,000
Allowance for Uncollectible Accounts (Dr.) . . . . . . . . . . . . . . . . . . . . . 10,000
Sales Revenues (Cr.) . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . 800,000
On December 31, 2014, Pins Company carried out an aging of its accounts receivable balances and estimated that the 2014 ending balance of accounts receivable contained $11,000of probable uncollectibles. That is, the allowance account should have an $11,000 ending credit balance. It made adjusting entries appropriate for this estimate. Some of the $800,000 sales during 2014 were for cash and some were on account; the problem purposefully does not give the amounts.
a. What was the balance in the Accounts Receivable, Gross, at the end of 2013? Give the amount and whether it was a debit or a credit.
b. What was the balance in the Allowance for Uncollectible Accounts account at the end of 2013? Give the amount and whether it was a debit or a credit.
c. What was bad debt expense for 2014?
d. What was the amount of specific accounts receivable written off as being uncollectible during 2014?
e. What were total cash collections in 2014 from customers (for cash sales and collections from customers who had purchased on account in either 2013 or 2014)?
f. What was the net balance of accounts receivable included in the balance sheet asset total for December 31, 2014?