Question

E7-7.   (Recording Bad Debts) (LO 3) Duncan Company reports the following financial information before adjustments. Dr....

E7-7.  

(Recording Bad Debts)

(LO 3) Duncan Company reports the following financial information before adjustments.

Dr.

Cr.

Accounts Receivable

$100,000

Allowance for Doubtful Accounts

$  2,000

Sales Revenue (all on credit)

 900,000

Sales Returns and Allowances

  50,000

Instructions

Prepare the journal entry to record Bad Debt Expense assuming Duncan Company estimates bad debts at (a) 5% of accounts receivable and (b) 5% of accounts receivable but Allowance for Doubtful Accounts had a $1,500 debit balance.

Homework Answers

Answer #1

a)

Date

Particulars

Debit

Credit

Dec. 31

Bad debt expense ((100,000 * 5%) - 2,000)

3,000

        Allowance for doubtful accounts

3,000

b)

Date

Particulars

Debit

Credit

Dec. 31

Bad debt expense ((100,000 * 5%) +1,500)

6,500

        Allowance for doubtful accounts

6,500

I hope it is useful to u if u have any doubt pls comment give me up thumb

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
C. Company reports the following financial information before adjustments. Dr. Cr. Accounts Receivable $165,800 Allowance for...
C. Company reports the following financial information before adjustments. Dr. Cr. Accounts Receivable $165,800 Allowance for Doubtful Accounts $3,730 Sales Revenue (all on credit) 840,900 Sales Returns and Allowances 52,650 Prepare the journal entry to record bad debt expense assuming C. Company estimates bad debts at (a) 5% of accounts receivable and (b) 5% of accounts receivable but Allowance for Doubtful Accounts had a $1,380 debit balance.
E7-9.   (Computing Bad Debts and Preparing Journal Entries) (LO 3) The trial balance before adjustment of...
E7-9.   (Computing Bad Debts and Preparing Journal Entries) (LO 3) The trial balance before adjustment of Taylor Swift Inc. shows the following balances. Dr. Cr. Accounts Receivable $90,000 Allowance for Doubtful Accounts   1,750 Sales Revenue (all on credit) $680,000 Instructions Give the entry for estimated bad debts assuming that the allowance is to provide for doubtful accounts on the basis of (a) 4% of gross accounts receivable and (b) 5% of gross accounts receivable and Allowance for Doubtful Accounts has...
E7-8.   (Recording Bad Debts) (LO 3) At the end of 2017, Aramis Company has accounts receivable...
E7-8.   (Recording Bad Debts) (LO 3) At the end of 2017, Aramis Company has accounts receivable of $800,000 and an allowance for doubtful accounts of $40,000. On January 16, 2018, Aramis Company determined that its receivable from Ramirez Company of $6,000 will not be collected, and management authorized its write-off. Instructions (a)   Prepare the journal entry for Aramis Company to write off the Ramirez receivable. (b)   What is the net realizable value of Aramis Company's accounts receivable before the write-off...
Entity G uses the percentage of receivables method for recording bad debts expense. The accounts receivable...
Entity G uses the percentage of receivables method for recording bad debts expense. The accounts receivable balance is $500,000. Management estimates that 5% of accounts receivable will be uncollectible. What adjusting entry will Entity G make if the Allowance for Doubtful Accounts has a credit balance of $4,000 before adjustment? Dr. Bad Debt Expense                                     21,000       Cr. Accounts Receivable                                             21,000 Dr. Bad Debt Expense                                     21,000       Cr. Allowance for Doubtful Accounts                      21,000 Dr. Bad Debt Expense...
Required information Problem 7-2A Estimating and reporting bad debts LO P2, P3 Skip to question [The...
Required information Problem 7-2A Estimating and reporting bad debts LO P2, P3 Skip to question [The following information applies to the questions displayed below.] At December 31, Hawke Company reports the following results for its calendar year. Cash sales $ 1,266,330 Credit sales $ 3,708,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable $ 1,123,524 debit Allowance for doubtful accounts $ 16,940 debit Problem 7-2A Part 1 Required: 1. Prepare the adjusting entry to record bad...
Crane Company uses the percentage of sales method for recording bad debts expense. For the year,...
Crane Company uses the percentage of sales method for recording bad debts expense. For the year, cash sales are $590000 and credit sales are $2600000. Management estimates that 3% is the sales percentage to use. What adjusting entry will Crane Company make to record the bad debts expense? Bad Debt Expense 78000     Accounts Receivable 78000 Bad Debt Expense 17700     Accounts Receivable 17700 Bad Debt Expense 17700    Allowance for Doubtful Accounts 17700 Bad Debt Expense 78000     Allowance for Doubtful Accounts 78000
[The following information applies to the questions displayed below.] At December 31, 2017, Hawke Company reports...
[The following information applies to the questions displayed below.] At December 31, 2017, Hawke Company reports the following results for its calendar year. Cash sales $ 1,905,000 Credit sales 5,682,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable $ 1,270,100 debit Allowance for doubtful accounts 16,580 debit Required: 1. Prepare the adjusting entry for this company to recognize bad debts under each of the following independent assumptions. a. Bad debts are estimated to be 1.5% of...
Problem 7-4A Accounts receivable transactions and bad debts adjustments LO C1, P2, P3 Liang Company began...
Problem 7-4A Accounts receivable transactions and bad debts adjustments LO C1, P2, P3 Liang Company began operations on January 1, 2016. During its first two years, the company completed a number of transactions involving sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows: 2016 Sold $1,345,434 of merchandise (that had cost $975,000) on credit, terms n/30. Wrote off $18,300 of uncollectible accounts receivable. Received $669,200 cash in payment of accounts receivable. In adjusting the...
At December 31, Hawke Company reports the following results for its calendar year. Cash sales $...
At December 31, Hawke Company reports the following results for its calendar year. Cash sales $ 1,905,000 Credit sales $ 5,682,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable $ 1,270,100 debit Allowance for doubtful accounts $ 16,580 debit Required: 1. Prepare the adjusting entry to record bad debts under each separate assumption. Bad debts are estimated to be 1.5% of credit sales. Bad debts are estimated to be 1% of total sales. An aging analysis...
[The following information applies to the questions displayed below.] At December 31, Hawke Company reports the...
[The following information applies to the questions displayed below.] At December 31, Hawke Company reports the following results for its calendar year. Cash sales $ 1,905,000 Credit sales $ 5,682,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable $ 1,270,100 debit Allowance for doubtful accounts $ 16,580 debit Required: 1. Prepare the adjusting entry to record bad debts under each separate assumption. Bad debts are estimated to be 1.5% of credit sales. Bad debts are estimated...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT