Accounting: What the Numbers Mean
11th Edition
ISBN: 9781259535314
Author: David Marshall, Wayne William McManus, Daniel Viele
Publisher: McGraw-Hill Education
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Textbook Question
Chapter 5, Problem 5.11E
Exercise 5.11
LO 5
Required:
- What was the total of accounts written off during the first 11 months? (Hint: Make a T-account for the Allowance for Bad Debts account.)
- As the result of a comprehensive analysis, it is determined that the December 31, 2016, balance of the Allowance for Bad Debts account should be $19,000. Show the adjustment required in the horizontal model or in
journal entry format. - During a conversation with the credit manager, one of Tabor’s sales representatives learns that a $2,460 receivable from a bankrupt customer has not been written off but was considered in the determination of the appropriate year-end balance of the Allowance for Bad Debts account balance. Write a brief explanation to the sales representative explaining the effect that the write-off of this account receivable would have had on 2016 net income.
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Problem 4
Part A. On 12/31/16, Phoebe Company’s balance sheet revealed a $7,000 balance in its allowance for doubtful accounts. During 2017, $2,000 of accounts were written off and $500 of accounts receivable previously written off were collected. On 12/31/17, bad debt expense was estimated to be 5% on net credit sales, which were $400,000
Required: Calculate the balance in the allowance for doubtful accounts on 12/31/17.
Part B. The following information was taken from the unadjusted trial balance and aging schedule of Diane Company on December 31, 2017. All sales are on account.
Accounts and related balances at December 31, 2017 before adjustment:
Debit
Credit
Accounts receivable
$46,000
Allowance for doubtful accounts
$ 680
Sales (all on account)
500,000
Sales returns
3,000
Aging Schedule of Accounts Receivable:
Age
Amount
% Uncollectible
0-30 days
$14,000
5%
30-60…
Question 4
Maple Co. provides for bad debts expense at the rate of 5.72% of ending Accounts Receivable. On
Jan 1, 20X1, the Allowance for Bad Debts was $18,000. There were $16,000 of accounts written off
during the year. Credit sales for the year were $640,000. Ending Accounts Receivable was
$115,000.
What is the amount of Bad Debt Expense for the year?
Enter your response as a whole number, no commas and no dollar signs.
Your Answer:
Exercise 8-5
Waterway Industries has accounts receivable of $98,600 at March 31, 2017. Credit terms are 2/10, n/30. At March 31, 2017, there is a $2,227 credit balance in Allowance for Doubtful Accounts prior to adjustment. The company uses the percentage-of-receivables basis for estimating uncollectible accounts. The company’s estimates of bad debts are as shown below.
Balance, March 31
Estimated PercentageUncollectible
Age of Accounts
2017
2016
Current
$68,400
$69,990
2
%
1–30 days past due
13,700
7,880
5
31–90 days past due
9,700
2,400
28
Over 90 days past due
6,800
1,100
49
$98,600
$81,370
Determine the total estimated uncollectibles.
The total estimated uncollectibles
$
Prepare the adjusting entry at March 31, 2017, to record bad debt expense. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Chapter 5 Solutions
Accounting: What the Numbers Mean
Ch. 5 - Prob. 5.1MECh. 5 - Prob. 5.2MECh. 5 - Mini-Exercise 5.3 LO 5 Accounts receivable, bad...Ch. 5 - Mini-Exercise 5.4 LO 5 Bad debts...Ch. 5 - Mini-Exercise 5.5 LO 7, 8 Cost flow...Ch. 5 - Mini-Exercise 5.6 LO 7, 8 Cost flow...Ch. 5 - Prob. 5.7ECh. 5 - Prob. 5.8ECh. 5 - Prob. 5.9ECh. 5 - Prob. 5.10E
Ch. 5 - Exercise 5.11 LO 5 Bad debts analysis-Allowance,...Ch. 5 - Exercise 5.12 LO 5 Bad debts analysis-Allowance...Ch. 5 - Exercise 5.13 LO 5 Cash discounts-ROI Annual...Ch. 5 - Prob. 5.14ECh. 5 - Exercise 5.15 LO 6 Notes receivable-interest...Ch. 5 - Exercise 5.16 LO 6 Notes receivable-interest...Ch. 5 - Exercise 5.17 LO 7, 8 LIFO versus FIFO-matching...Ch. 5 - Prob. 5.18ECh. 5 - Prob. 5.19ECh. 5 - Prob. 5.20ECh. 5 - Exercise 5.21 LO 5, 6, 8 Transaction...Ch. 5 - Exercise 5.22 LO 5. 8, 10 Transaction...Ch. 5 - Exercise 5.23 LO 5, 6, 7 Transaction...Ch. 5 - Exercise 5.24 LO 7, 8, 10 Transaction...Ch. 5 - Prob. 5.25PCh. 5 - Prob. 5.26PCh. 5 - Problem 5.27 LO 5 Bad debts analysis-Allowance...Ch. 5 - Problem 5.28 LO 5 Bad debts analysis-Allowance...Ch. 5 - Problem 5.29 LO 5 Analysis of accounts receivable...Ch. 5 - Problem 5.30 LO 5 Analysis of accounts receivable...Ch. 5 - Problem 5.31 LO 7, 8 Cost flow assumptions-FIFO...Ch. 5 - Problem 5.32 LO 7, 8 Cost flow assumptions-FIFO,...Ch. 5 - Prob. 5.33PCh. 5 - Prob. 5.34PCh. 5 - Problem 5.35 LO 7 Effects of inventory errors If...Ch. 5 - Prob. 5.36PCh. 5 - Case 5.37 LO 5, 7, 8 Focus company-accounts...Ch. 5 - Case 5.38
LO 5, 7
Comparative analysis of current...
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