Question

For each of the following scenarios, indicate the Bad Debt Expense to be recorded in 2011, the balance in the Allowance for Doubtful Accounts account at December 31, 2011, and the net realizable value of the Accounts Receivable at December 31, 2011:
a. An analysis of Simmon's Company's $830,000 balance in Accounts Receivable at December 31, 2011, indicates $15,500 of uncollectible receivables. Before adjustment the balance in Allowance for Doubtful Accounts is a credit balance of $1,200.
b. Blake Company had net credit sales of $900,000 during 2011, and has an Accounts Receivable balance of $425,000 at December 31, 2011, and an Allowance for Doubtful Accounts credit balance of $8,000. Blake estimates Bad Debt Expense as 3/4 of 1% of net credit sales. 
c. Hidgon Inc. has a balance of $312,000 in Accounts Receivable at December 31, 2011. An analysis of those receivables shows $2,400 will probably not be collected. Before adjusting entries are prepared, the Allowance for Doubtful Accounts has a debit balance of $750.



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  • CreatedJuly 26, 2013
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