The following information is extracted from the accounting records of the Shelton Corporation at the beginning of
Question:
The following information is extracted from the accounting records of the Shelton Corporation at the beginning of 2007:
Accounts Receivable .........$63,000
Allowance for Doubtful Accounts.....1,400 (credit)
During 2007, sales on credit amounted to $575,000, $557,400 was collected on outstanding receivables, and $2,600 of receivables were written off as uncollectible. On December 31, 2007, Shelton estimates its bad debts to be 4% of the outstanding gross accounts receivable balance.
Required
1. Prepare the journal entry necessary to record Shelton’s estimate of bad debt expense for 2007.
2. Prepare the Accounts Receivable section of Shelton’s December 31, 2007 balance sheet.
3. Compute Shelton’s receivables turnover.
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
Step by Step Answer:
1 Balance in accounts receivable 1107 63000 Sales on credit 57500...View the full answer
Intermediate Accounting
ISBN: 978-0324300987
10th Edition
Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones
