Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following...
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Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis. Days Past Due 31 to 60 61 to 90 $45,000 2% Total 1 to 30 Over 90 Accounts receivable Percent uncollectible $405,000 $99,000 1% $615,000 $27,000 $39,000 7% 5% 10% a. Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 6% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method. Estimated balance of allowance for uncollectibles 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 $12,900 credit and $1,900 debit. Following are selected transactions for Vitalo Company. Nov. 1 Accepted a $14,000, 180-day, 8% note dated November 1 from Kelly White in granting a time extension on her past-due account receivable. Dec. 31 Adjusted the year-end accounts for the accrued interest earned on the White note. Apr. 30 White honors her note when presented for payment; February has 28 days for the current year. First, complete the table below to calculate the interest amounts at December 315t and April 30th. (Round your final answers to nearest whole dollar. Use 360 days a year.) November 1 January 1 Total Through Through Through Maturity December 31 April 30 Principal Rate (%) % % Time Total interest Use those calculated values to prepare your journal entries (assume that no reversing entries are recorded). View transaction list Journal entry worksheet 1 2 3 Accepted a $14,000, 180-day,8% note dated November 1 from Kelly White in granting a time extension on her past-due account receivable. Note: Enter debits before credits. Date General Journal Debit Credit Nov 01 Record entry Clear entry View general journal Daley Company estimates uncollectible accounts using the allowance method at December 31. It prepared the following aging of receivables analysis. Days Past Due 31 to 60 61 to 90 $45,000 2% Total 1 to 30 Over 90 Accounts receivable Percent uncollectible $405,000 $99,000 1% $615,000 $27,000 $39,000 7% 5% 10% a. Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 6% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method. Estimated balance of allowance for uncollectibles 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 $12,900 credit and $1,900 debit. Following are selected transactions for Vitalo Company. Nov. 1 Accepted a $14,000, 180-day, 8% note dated November 1 from Kelly White in granting a time extension on her past-due account receivable. Dec. 31 Adjusted the year-end accounts for the accrued interest earned on the White note. Apr. 30 White honors her note when presented for payment; February has 28 days for the current year. First, complete the table below to calculate the interest amounts at December 315t and April 30th. (Round your final answers to nearest whole dollar. Use 360 days a year.) November 1 January 1 Total Through Through Through Maturity December 31 April 30 Principal Rate (%) % % Time Total interest Use those calculated values to prepare your journal entries (assume that no reversing entries are recorded). View transaction list Journal entry worksheet 1 2 3 Accepted a $14,000, 180-day,8% note dated November 1 from Kelly White in granting a time extension on her past-due account receivable. Note: Enter debits before credits. Date General Journal Debit Credit Nov 01 Record entry Clear entry View general journal
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Related Book For
Fundamental accounting principle
ISBN: 978-0078025587
21st edition
Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta
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