Information related to Mingenback Company for 2017 is summarized below. Total credit sales .............. $2,500,000 Accounts receivable at December 31 ...... 875,000 Bad debts written off ............ 33,000
Instructions (a) What amount of bad debt expense will Mingenback Company report if it uses the direct write-off method of accounting for bad debts? (b) Assume that Mingenback Company estimates its bad debt expense to be 2% of credit sales. What amount of bad debt expense will Mingenback record if it has an Allowance for Doubtful Accounts credit balance of $4,000? (c) Assume that Mingenback Company estimates its bad debt expense based on 6% of accounts receivable. What amount of bad debt expense will Mingenback record if it has an Allowance for Doubtful Accounts credit balance of $3,000? (d) Assume the same facts as in (c), except that there is a $3,000 debit balance in Allowance for Doubtful Accounts. What amount of bad debt expense will Mingenback record? (e) What is the weakness of the direct write-off method of reporting bad debt expense?
... same facts as in (c), except that there is a $3,000 debit balance in Allowance for Doubtful Accounts. What amount of bad debt expense will Mingenback record?(e) What is the weakness of the direct...
... facts as in (c), except that there is a $3,000 debit balance in Allowance for Doubtful Accounts. What amount of bad debt expense will Mingenback record? (d) What is the weakness of the direct write-off...
a development cost and be eligible for capitalization. Required: Identify each of the six criteria and explain why each one is essential for the classification of an expenditure to qualify as a development cost and therefore be...
income tax purposes. a. If a company pays 5 percent interest to borrow $500,000, but is in an income tax bracket that requires it to pay 30 percent income tax, what is the actual net-of-tax interest cost that the company incurs?...
estimate your fixed cost at $15,000 and the variable cost of each copy sold at $.01. You expect the selling price to average $.05. (a) What is the break-even point in dollars? (b) What is the break-even point in units?
database system, database catalog, program-data independence, user view, DBA, end user, canned transaction, meta-data, and transaction-processing application. 1.2. What four main types of actions involve databases?...
proprietorship. This year, she sells the following long-term assets used in her business: Asset____________ Sales Price ________Cost _________Accumulated Depreciation Building................$...
balance sheet.Accounts receivable ............ $960,000Less: Allowance for doubtful accounts .... 80,000During 2017, the company had the following transactions related to receivables.1. Sales on account...
following amounts before adjustment. Instructions (a) Based on the information given, which method of accounting for bad debts is Darby Company using—the direct write-off method or the allowance method? How can you tell? (b)...
the end of the spring semester, the following facts were discovered about Adam\'s Lunch (AL), Pizza Tower (PT), and the Dining Hall (DH). 30 liked AL but not PT 21 liked AL only 63 liked AL 58 liked PT 27 liked DH 25 liked PT and AL...
to join the union, Baker called three of her most trusted employees to her office. She urged them to organize a new union limited to company employees. She offered to provide the union with office space and time for officers...