Exam 8: Receivables

When using the allowance method to estimate uncollectible accounts receivable based on an analysis of receivables shows that $640 of accounts receivables are uncollectible.The Allowance for Doubtful Accounts has a debit balance of $110.The adjusting entry at the end of the year will include a credit to Allowance for Doubtful Accounts in the amount of:

When a company receives an interest-bearing note receivable,it will

Abbott Company uses the allowance method of accounting for uncollectible accounts.Abbott estimates that 3% of net credit sales will be uncollectible.On January 1,2010,the Allowance for Doubtful Accounts had a credit balance of $2,400.During 2010,Abbott wrote-off accounts receivable totaling $1,800 and made credit sales of $100,000.There were no Sales Returns or Sales Discounts during the year.After the adjusting entry,the December 31,2010,balance in the Bad Debt Expense would be

Journalize the following transactions for Solley Company that occurred during 2011 and 2012. November 14,2011 Received a $4,800.00,90-day,9% note from Alan Hibbetts in payment of his account. December 31,2011 Accrued interest on the Hibbetts note. February 12,2012 Received the amount due from Hibbetts on his note.

The difference between the balance in Accounts Receivable and the balance in the Allowance for Doubtful Accounts is called the net realizable value.

An aging of a company's accounts receivable indicates that estimate of the uncollectible accounts totals $4,000.If Allowance for Doubtful Accounts has a $800 credit balance,the adjustment to record the bad debt expense for the period will require a

Receivables that are expected to be collected in cash in eighteen months or less are reported in the Current Asset section of the balance sheet.

At the end of the current year,Accounts Receivable has a balance of $550,000;Allowance for Doubtful Accounts has a credit balance of $5,500;and net sales for the year total $2,500,000.An analysis of receivables estimates uncollectible receivables as $25,000. Determine the net realizable value of accounts receivable after adjustment.(Hint: Determine the amount of the adjusting entry for bad debt expense and the adjusted balance Allowance of Doubtful Accounts. )

The two methods of accounting for uncollectible receivables are the allowance method and the

An aging of a company's accounts receivable indicates the estimate of uncollectible receivables totals $7,900.If Allowance for Doubtful Accounts has a $700 credit balance,the adjustment to record the bad debt expense for the period will require a

When comparing the direct write-off method and the allowance method of accounting for uncollectible receivables,a major difference is that the direct write-off method

Using the allowance method of accounting for uncollectible receivables,the entry to reinstate a specific receivable previously written off would include a

For each of the following scenarios,indicate the amount of the adjusting journal entry for Bad Debt Expense to be recorded in 2014,the balance in Allowance for Doubtful Accounts after adjustment at December 31,2014,and the net realizable value of Accounts Receivable at December 31,2014: a)Based on an analysis of Simmon's Company's $380,000 balance in Accounts Receivable at December 31,2014,is was estimated that $15,500 will be uncollectible.There is a credit balance of $1,200 in Allowance for Doubtful Accounts before adjustment. b)Blake Company had net credit sales of $900,000 during 2014,and has an Accounts Receivable balance of $425,000 at December 31,2014,and an Allowance for Doubtful Accounts credit balance of $11,000 before adjustment.Blake estimates Bad Debt Expense as 3/4 of 1% of net credit sales. c)Hidgon Inc.has a balance of $812,000 in Accounts Receivable at December 31,2014.An analysis of those receivables shows $24,000 will probably not be collected.Before adjusting entries are prepared,the Allowance for Doubtful Accounts has a debit balance of $750.

Determine the due date and the amount of interest due at maturity on the following notes:

Harper Company lends Hewell Company $40,000 on March 1,accepting a four-month,6% interest note.Harper Company prepares financial statements on March 31.What adjusting entry should be made before the financial statements can be prepared?

Fellows Corporation has determined that the $2,700 accounts receivable due from Andrew Stevens is uncollectible.Compare the journal entry that is required under the direct write-off method to the journal entry that is required using the allowance method.

When does an account become uncollectible?

The accounts receivables turnover ratio is computed by dividing total gross sales by the average net receivables during the year.

At the end of a period, (before adjustment),Allowance for Doubtful Accounts has a credit balance of $250.The net credit sales for the period total $500,000.If the company estimates uncollectible accounts expense at 1% of net credit sales,the amount of bad debt expense to be recorded in an adjusting entry is $4,750.

You have just received notice that a customer of yours with an Account Receivable balance of $100 has gone bankrupt and will not make any future payments.Assuming you use the allowance method,the entry you make is to