ACC 291T Wk 4 – Apply: Connect Homework (2021 New)

Warner Company’s year-end unadjusted trial balance shows accounts receivable of $117,000, allowance for doubtful accounts of $780 (credit), and sales of $460,000. Uncollectibles are estimated to be 1.50% of accounts receivable.

1. Prepare the December 31 year-end adjusting entry for uncollectibles.

2. What amount would have been used in the year-end adjusting entry if the allowance account had a year-end unadjusted debit balance of $1,200?

Mazie Supply Co. uses the percent of accounts receivable method. On December 31, it has outstanding accounts receivable of $64,000, and it estimates that 2% will be uncollectible.

Prepare the year-end adjusting entry to record bad debts expense under the assumption that the Allowance for Doubtful Accounts has:

• (a)a $1,088 credit balance before the adjustment.
• (b)a $320 debit balance before the adjustment.

3.Gomez Corp. uses the allowance method to account for uncollectibles. On January 31, it wrote off an $2,400 account of a customer, C. Green. On March 9, it receives a $1,900 payment from Green.

1. Prepare the journal entry for January 31

2. Prepare the journal entries for March 9; assume no additional money is expected from Green.

4.Prepare journal entries for the following credit card sales transactions (the company uses the perpetual inventory system).

• Sold $33,000 of merchandise, which cost $25,400, on Mastercard credit cards. Mastercard charges a 5% fee.
• Sold $6,300 of merchandise, which cost $3,650, on an assortment of bank credit cards. These cards charge a 4% fee.

5. Solstice Company, which uses the direct write-off method, determines on October 1 that it cannot collect $59,000 of its accounts receivable from its customer, P. Moore. On October 30, P. Moore unexpectedly pays his account in full to Solstice Company.Record Solstice’s entries for recovery of this bad debt.

6.

Solstice Company determines on October 1 that it cannot collect $67,000 of its accounts receivable from its customer, P. Moore. Apply the direct write-off method to record this loss as of October 1.

7.

Warner Company’s year-end unadjusted trial balance shows accounts receivable of $118,000, allowance for doubtful accounts of $790 (credit), and sales of $470,000. Uncollectibles are estimated to be 1% of sales.

Prepare the December 31 year-end adjusting entry for uncollectibles.

8.Net Zero Products, a wholesaler of sustainable raw materials. Prepared the following aging of receivables analysis.

1. Estimate the balance of the Allowance for Doubtful Accounts using the aging of accounts receivable method.

   2.Prepare the adjusting entry to record bad debts expense assuming the unadjusted balance in the Allowance for Doubtful Accounts is a $2,400 credit.

9. At year-end (December 31), Chan Company estimates its bad debts as 0.70% of its annual credit sales of $768,000. Chan records its Bad Debts Expense for that estimate. On the following February 1, Chan decides that the $384 account of P. Park is uncollectible and writes it off as a bad debt. On June 5, Park unexpectedly pays the amount previously written off.Prepare Chan’s journal entries for the transactions.

10.On December 31 of Swift Co.’s first year, $52,000 of accounts receivable is not yet collected. Swift estimates that $2,200 of its accounts receivable is uncollectible and records the year-end adjusting entry.

• (1)Compute the realizable value of accounts receivable reported on Swift’s year-end balance sheet.
• (2)On January 1 of Swift’s second year, it writes off a customer’s account for $200.
• Compute the realizable value of accounts receivable on January 1 after the write-off.

11.Required information

[The following information applies to the questions displayed below.]

Daley Company prepared the following aging of receivables analysis at December 31.

1. Complete the below table to calculate the estimated balance of Allowance for Doubtful Accounts using aging of accounts receivable.

   b.Prepare the adjusting entry to record Bad Debts Expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $3,700 credit.

   c. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $200 debit.

12.Required information

[The following information applies to the questions displayed below.]

Daley Company prepared the following aging of receivables analysis at December 31.

1. Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 4% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method.

   b.Prepare the adjusting entry to record Bad Debts Expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $12,100 credit.

   c. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $1,100 debit.