Johnson Company uses the allowance method to account for uncollectible accounts

Q: Johnson Company uses the allowance method to account for uncollectible accounts

Solution-1) Solution-2) $87,500 the amount of accounts receivable written off. Balance, beginning of year $51,000 Add: Bad debt expense for 2013 (1.50% × $5,400,000) $81,000 Less: End-of-year balance ($44,500) Accounts receivable written off $87,500

ID: 2455815 • Letter: J

Question

Johnson Company uses the allowance method to account for uncollectible accounts receivable. Bad debt expense is established as a percentage of credit sales. For 2013, net credit sales totaled $5,400,000, and the estimated bad debt percentage is 1.50%. The allowance for uncollectible accounts had a credit balance of $51,000 at the beginning of 2013 and $44,500, after adjusting entries, at the end of 2013.

1) Determine the amount of accounts receivable written off during 2013?

2) If the company uses the direct write-off method, what would bad debt expense be for 2013?

Explanation / Answer

Solution-1)

Solution-2)

$87,500 the amount of accounts receivable written off.

Balance, beginning of year $51,000 Add: Bad debt expense for 2013 (1.50% × $5,400,000) $81,000 Less: End-of-year balance ($44,500) Accounts receivable written off $87,500

Navigate

Johnson Company uses the allowance method to account for uncollectible accounts

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.

Johnson Company uses the allowance method to account for uncollectible accounts

Question

Explanation / Answer

Related Questions

Navigate