Question

Urgent!!

All option please

The ledger of XX Company at the end of the current year shows Accounts Receivable $110,000, Sales Revenue $840,000, and Sales Returns and Allowances $20,000.

(a) If XX uses the direct write-off method to account for uncollectible accounts, journalize the adjusting entry at December 31, assuming XX determines that L. Dole’s $1,400 balance is uncollectible.

(b) If Allowance for Doubtful Accounts has a credit balance of $2,100 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 1% of net sales, and (2) 10% of accounts receivable.

(c) If Allowance for Doubtful Accounts has a debit balance of $200 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 0.75% of net sales and (2) 6% of accounts receivable.

Answer 1

Transaction / Event	Account Titles	Debit	Credit
		$	$
a.	Bad Debt Expense	1,400
	Accounts Receivable		1,400
b.1.	Bad Debt Expense ( 840,000 - 20,000 ) x 1 %	8,200
	Allowance for Doubtful Accounts		8,200
b.2	Bad Debt Expense $ ( 110,000 x 10 % ) - $ 2,100	8,900
	Allowance for Doubtful Accounts		8,900
c.1.	Bad Debt Expense ( 840,000 - 20,000 ) x 0.75 %	6,150
	Allowance for Doubtful Accounts		6,150
c.2.	Bad Debt Expense $ ( 110,000 x 6 % ) + $ 200	6,800
	Allowance for Doubtful Accounts		6,800