On December 31, 2017, Bruce Corporation had the following account balances relat
ID: 2557367 • Letter: O
Question
On December 31, 2017, Bruce Corporation had the following account balances related to credit sales and receivables prior to recording adjusting entries: Accounts receivable $168,000 Allowance for doubtful accounts 700 credit balance Sales revenue (all credit sales) 550,000 Required: Prepare the necessary year-end adjusting entry related to uncollectible accounts for each of the following independent assumptions: A. On December 31 an Accounts Receivable (Jane Doe) of $300 from a prior year was determined to be uncollectible; therefore, it was written off immediately as a bad debt. B. It is estimated that a provision for bad debts is required for 1% of credit sales for the year. C. An aging of accounts receivable is completed. It is estimated that $6,000 of the receivables outstanding at year-end will be uncollectible.
Explanation / Answer
Required: Prepare the necessary year-end adjusting entry related to uncollectible accounts for each of the following independent assumptions:
Date accounts & explanation debit credit Dec 31 Allowance for doubtful accounts 300 account receivable 300 (To record write off) Dec 31 Bad debt expense (550000*1%) 5500 Allowance for doubtful accounts 5500 (To record bad debt expense) Dec 31 Bad debt expense (6000-400) 5600 Allowance for doubtful accounts 5600 (To record adjusting entry)Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.