Question

83. Using the percentage-of-receivables method for recording bad debt expense, estimated uncollectible accounts are $45500. If the balance of the Allowance for Doubtful Accounts is $5100 credit before adjustment what is the amount of bad debt expense for that period?

$45500

$5100

$50600

$40400

84.

Bramble Corp. bought equipment on January 1, 2017. The equipment cost $420000 and had an expected salvage value of $45000. The life of the equipment was estimated to be 6 years. The depreciable cost of the equipment is

$45000.

$375000.

$62500.

$420000.

85.

Novak Corp. bought equipment on January 1, 2017. The equipment cost $390000 and had an expected salvage value of $35000. The life of the equipment was estimated to be 5 years. The company uses the straight-line method of depreciation. The book value of the equipment at the beginning of the third year would be

$355000.

$248000.

$142000.

$390000.

Answer 1

83.

Bad debt = Estimated uncollectible - Credit balance of allowance for doubtful accounts

= $45,500 - $5,100

= $40,400

4th option

84.

Depreciable cost = Cost of the equipment - Salvage value

= $420,000 - $45,000

= $375,000

2nd option

85.

Depreciation expense per year = ($390,000 - $35,000) / 5 = $71,000

Depreciation expense for 2 years = $71,000 X 2

= $142,000

Book value of the equipment at the beginning of the third year = $390,000 - $142,000

= $248,000

2nd option