Question

Oriole Company uses the percentage-of-receivables basis to record bad debt expense. Accounts receivable (ending balance) $510,000...

Oriole Company uses the percentage-of-receivables basis to record bad debt expense.

Accounts receivable (ending balance) $510,000 (debit)
Allowance for doubtful accounts (unadjusted) 5,400 (debit)


The company estimates that 2% of accounts receivable will become uncollectible.

(a)

Prepare the adjusting journal entry to record bad debt expense for the year. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation

Debit

Credit


(b)

What is the ending (adjusted) balance in Allowance for Doubtful Accounts?

Ending (adjusted) balance in Allowance for Doubtful Accounts $


(c)

What is the cash (net) realizable value?

Cash (net) realizable value $

Homework Answers

Answer #1

Requirement a

General Journal Debit   Credit
Bad debts expense $        15,600.00
        Allowance for doubtful accounts $ 15,600.00
(To record bad debts expense)

Requirement b

Ending (adjusted) balance in Allowance for Doubtful Accounts = $10,200 Credit

Requirement c

Cash (net) realizable value= $499,800

Working

Estimated balance of allowance for uncollectables $ 10,200.00 Cr
Balance in Allowance for uncollectable account (Dr) $    5,400.00 Dr
Total bad debts to be recorded $ 15,600.00 Cr

.

Accounts receivable $ 510,000.00
Less: Allowance for doubtful accounts $    10,200.00
Cash (net) realizable value $ 499,800.00
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
Crane Company uses the percentage-of-receivables basis to record bad debt expense. Accounts receivable (ending balance) $630,000...
Crane Company uses the percentage-of-receivables basis to record bad debt expense. Accounts receivable (ending balance) $630,000 (debit) Allowance for doubtful accounts (unadjusted) 4,400 (debit) The company estimates that 3% of accounts receivable will become uncollectible. (a) Prepare the adjusting journal entry to record bad debt expense for the year. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (b) What is the ending (adjusted) balance in Allowance for Doubtful...
Coronado Industries uses the percentage-of-receivables basis to record bad debt expense and concludes that 3% of...
Coronado Industries uses the percentage-of-receivables basis to record bad debt expense and concludes that 3% of accounts receivable will become uncollectible. Accounts receivable are $385,200 at the end of the year, and the allowance for doubtful accounts has a credit balance of $2,870. (a) Prepare the adjusting journal entry to record bad debt expense for the year. (b) If the allowance for doubtful accounts had a debit balance of $887 instead of a credit balance of $2,870, prepare the adjusting...
Windsor, Inc. uses the percentage-of-receivables basis to record bad debt expense and concludes that 3% of...
Windsor, Inc. uses the percentage-of-receivables basis to record bad debt expense and concludes that 3% of accounts receivable will become uncollectible. Accounts receivable are $427,700 at the end of the year, and the allowance for doubtful accounts has a credit balance of $2,540. (a) Prepare the adjusting journal entry to record bad debt expense for the year. (b) If the allowance for doubtful accounts had a debit balance of $979 instead of a credit balance of $2,540, prepare the adjusting...
1. Using the percentage-of-receivables method for recording bad debt expense, estimated uncollectible accounts are $72000. If...
1. Using the percentage-of-receivables method for recording bad debt expense, estimated uncollectible accounts are $72000. If the balance of the Allowance for Doubtful Accounts is an $14400 debit before adjustment, what is the balance after adjustment? A. $72000 B. $14400 C. $86400 D. $57600 2. In reviewing the accounts receivable, the cash receivable value is $25400 before the write-off of a $1800 account. What is the cash receivable value after the write-off? A. $25400 B. $1800 C. $27200 D. $23600...
Momrow Inc. uses the percentage of credit sales method to estimate its bad debt expense and...
Momrow Inc. uses the percentage of credit sales method to estimate its bad debt expense and estimates that 5% of credit sales will result in uncollectible accounts. The company had $320,000 of net credit sales during the year, and its Allowance for Doubtful Accounts has an unadjusted credit balance of $6,300. After making the adjusting entry for to record bad debt expense, what is the ending balance in the Allowance for Doubtful Accounts account? Multiple Choice $12,600. $9,700. $16,000. $22,300.
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...
rose company uses the percentage of receivables method for recording bad debt expense. the accounts receivable...
rose company uses the percentage of receivables method for recording bad debt expense. the accounts receivable balance is $25,000 and credit sales ar $100,000. management estimates that 6% of accounts receivable will be uncollectible. what adjusting entry will rose company make if the allowance for doubtful accounts has a balance of $250 before adjustment?
Percent of Sales Method At the end of the current year, Accounts Receivable has a balance...
Percent of Sales Method At the end of the current year, Accounts Receivable has a balance of $835,000; Allowance for Doubtful Accounts has a credit balance of $7,500; and sales for the year total $3,760,000. Bad debt expense is estimated at 1/2 of 1% of sales. a. Determine the amount of the adjusting entry for uncollectible accounts. $ b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. Adjusted Balance Debit (Credit) Accounts Receivable...
Brief Exercise 8-6 Farr Co. elects to use the percentage-of-sales basis in 2017 to record bad...
Brief Exercise 8-6 Farr Co. elects to use the percentage-of-sales basis in 2017 to record bad debt expense. It estimates that 4% of net credit sales will become uncollectible. Sales revenues are $801,000 for 2017, sales returns and allowances are $45,800, and the allowance for doubtful accounts has a credit balance of $9,000. Prepare the adjusting entry to record bad debt expense in 2017. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) list of...
Problem 8-05A a-d At December 31, 2022, the trial balance of Oriole Company contained the following...
Problem 8-05A a-d At December 31, 2022, the trial balance of Oriole Company contained the following amounts before adjustment. Debit Credit Accounts Receivable $175,800 Allowance for Doubtful Accounts $   1,600 Sales Revenue 827,000 (a) Prepare the adjusting entry at December 31, 2022, to record bad debt expense, assuming that the aging schedule indicates that $9,920 of accounts receivable will be uncollectible. (b) Repeat part (a), assuming that instead of a credit balance there is a $1,600 debit balance in Allowance for...