Air King Corp has accounts receivable balance of $150,000 at December 31, 2020. It has a...
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Air King Corp has accounts receivable balance of $150,000 at December 31, 2020. It has a debit balance of $3,000 in Allowance for Doubtful Account prior to adjustment, at December 31, 2020. The company uses the ageing of accounts receivable for estimating uncollectible accounts. The company's estimated company's estimates of uncollectible accounts are as shown below. Age of Accounts Current 1-30 days past due 31-9 days past due Dec. 31, 2020 $100,000 20,000 15,000 91-180 days past due 10,000 Over 180 days past due 5,000 Estimated % Uncollectible 1% 10% 20% 40% 50% $150,000 During 2021, Air King Corp. Had net credit sales of $1,000,000 and collections of $950,000. It wrote off uncollectible accounts receivable of $9,500. However, a $1,500 account previously written off was recovered before the end of the current year. Air King Corporation estimates that 8% of its accounts receivable at 12/31/2021 will be uncollectible. REQUIRED A. Prepare the journal entry to record the bad debt expense at 12/31/2020. B. Prepare the journal entries to record sales and collection during 2021. C. Prepare the journal entry to record the write-off of uncollectible accounts during 2021. D. Prepare the journal entries to record the recovery of uncollectible accounts during 2021. E. Determine the ending balance of accounts receivable and the unadjusted balance in Allowance for Doubtful Accounts for 20201 F. Prepare the journal entry to record the bad debt expense at 12/31/2021. G. Indicate how the accounts receivable will be reported on the 12/31/2021 balance sheet. Air King Corp has accounts receivable balance of $150,000 at December 31, 2020. It has a debit balance of $3,000 in Allowance for Doubtful Account prior to adjustment, at December 31, 2020. The company uses the ageing of accounts receivable for estimating uncollectible accounts. The company's estimated company's estimates of uncollectible accounts are as shown below. Age of Accounts Current 1-30 days past due 31-9 days past due Dec. 31, 2020 $100,000 20,000 15,000 91-180 days past due 10,000 Over 180 days past due 5,000 Estimated % Uncollectible 1% 10% 20% 40% 50% $150,000 During 2021, Air King Corp. Had net credit sales of $1,000,000 and collections of $950,000. It wrote off uncollectible accounts receivable of $9,500. However, a $1,500 account previously written off was recovered before the end of the current year. Air King Corporation estimates that 8% of its accounts receivable at 12/31/2021 will be uncollectible. REQUIRED A. Prepare the journal entry to record the bad debt expense at 12/31/2020. B. Prepare the journal entries to record sales and collection during 2021. C. Prepare the journal entry to record the write-off of uncollectible accounts during 2021. D. Prepare the journal entries to record the recovery of uncollectible accounts during 2021. E. Determine the ending balance of accounts receivable and the unadjusted balance in Allowance for Doubtful Accounts for 20201 F. Prepare the journal entry to record the bad debt expense at 12/31/2021. G. Indicate how the accounts receivable will be reported on the 12/31/2021 balance sheet.
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Answer rating: 100% (QA)
A Prepare the journal entry to record the bad debt expense at 12312020 Date December 31 2020 Bad Debt Expense 4150 Allowance for Doubtful Accounts 415... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-0176509736
10th Canadian Edition, Volume 1
Authors: Donald Kieso, Jerry Weygandt, Terry Warfield, Nicola Young,
Posted Date:
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