Assume that this company's bad debts are estimated and recorded as 1.5% of credit sales.
On December 31,of the current year,a company's unadjusted trial balance revealed the following: Accounts receivable of $185,600; Sales Revenue of $1,280,000; (75% were on credit)and Allowance for Doubtful Accounts of $1,600 (credit balance).
1.Show how Accounts Receivable and the Allowance for Doubtful Accounts would appear on the balance sheet after adjustment.
2.Prepare the entry to write off a $1,500 account receivable on January 1 of the next year.
3.Show how Accounts Receivable and the Allowance for Doubtful Accounts would appear on the balance sheet immediately after writing off the account in part 2.

Question

Quizplus · Accepted Answer

The Answer of Assume that this company's bad debts are estimated and recorded as 1.5% of credit sales.
On December 31,of the current year,a company's unadjusted trial balance revealed the following: Accounts receivable of $185,600; Sales Revenue of $1,280,000; (75% were on credit)and Allowance for Doubtful Accounts of $1,600 (credit balance).
1.Show how Accounts Receivable and the Allowance for Doubtful Accounts would appear on the balance sheet after adjustment.
2.Prepare the entry to write off a $1,500 account receivable on January 1 of the next year.
3.Show how Accounts Receivable and the Allowance for Doubtful Accounts would appear on the balance sheet immediately after writing off the account in part 2.

Assume That This Company's Bad Debts Are Estimated and Recorded