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Sergeeva-Olga [200]
2 years ago
9

Lin’s Dairy uses the aging approach to estimate bad debt expense. The ending balance of each account receivable is aged on the b

asis of three time periods as follows: (1) not yet due, $17,100; (2) up to 120 days past due, $6,300; and (3) more than 120 days past due, $3,300. Experience has shown that for each age group, the average loss rate on the amount of the receivables at year-end due to uncollectibility is (1) 2 percent, (2) 15 percent, and (3) 35 percent, respectively. At the end of the current year, the Allowance for Doubtful Accounts balance is $700 (credit) before the end-of-period adjusting entry is made. Required: What amount should be recorded as Bad Debt Expense for the current year? (Enter your answers as a whole percentage (i.e., 0.12 should be entered as 12).)
Business
1 answer:
Nesterboy [21]2 years ago
4 0
What amount should be recorded as Bad Debt Expense for the current year?
Not yet due:
22,000
Estimated Percentage Uncollectible: 3%
Estimated Amount Uncollectible: 660

Up to 120 days past due:
6500
Estimated Percentage Uncollectible: 14%
Estimated Amount Uncollectible:
910

Over 120 days past due:
2800
Estimated Percentage Uncollectible: 34%
Estimated Amount Uncollectible: 952

Estimated Balance in allowance for doubtful accounts: 2522

Current balance in allowance for doubtful accounts: 1200

Bad Debt Expense for the Year: 1322
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Straight Industries purchased a large piece of equipment from Curvy Company on January 1, 2019. Straight Industries signed a not
Damm [24]

Answer:

$30,604

Explanation:

The computation of the interest expense for the year 2020 is as follows:

2019 interest expense is

= Equipment amount × rate of interest

= $311,967 × 9%

= $28,077

The Dec 31 2019 liability of book value is

= $311,967 + $28,077

= $340,044

Now the interest expense for the year 2020 is

= $340,044 × 0.09

= $30,604

3 0
2 years ago
On January 1, 2018, Red Flash Photography had the following balances: Cash, $21,000; Supplies, $8,900; Land, $69,000; Deferred R
Nutka1998 [239]

Answer:

See explanation

Explanation:

Red Flash Photography

Journal Entries

1. Debit     Cash                 $29,000

Credit       Common Stock               $29,000

(issuing common stock for cash that will increase the cash)

2. Debit    Cash                               $44,000

   Debit    Accounts Receivable    $39,000

 Credit           Service Revenue                   $83,000

(Provided services on account and cash)

3. Debit    Salaries expense            $32,000

Credit               Cash                                     $32,000

(Paid salaries to workers)

4. Debit    Prepaid Rent                   $21,000

Credit               Cash                                     $21,000

(Paid rent in advance for cash)

5. Debit    Supplies                          $31,000

Credit                  Accounts payable            $31,000

(Purchase supplies on account means liability will increase)

6. Debit    Dividends                        $2,900

Credit                   Cash                                 $2,900

(Paid cash dividends to the shareholders)

7 0
3 years ago
Krepps Corporation produces a single product. Last year, Krepps manufactured 33,100 units and sold 27,800 units. Production cost
AfilCa [17]

Answer:

The correct answer is $95,400 lower than absorption costing.

Explanation:

According to the scenario, the given data are as follows:

Units manufactured = 33,100

Sold units = 27,800

So, Units in ending inventory can be calculated as follows:

Units in ending inventory = Units manufactured - Sold units

= 33,100 - 27,800 = 5,300 units

Now, Fixed manufacturing OH = $595,800

So, we can calculate the fixed manufacturing OH per unit by using following formula:

Fixed manufacturing OH per unit = $595,800 ÷ 33,100 = $18

So, Difference in net income for the year can be calculated as follows:

Net income difference = Fixed manufacturing OH per unit × Units in ending inventory

= $18 × 5,300 units = $95,400

Hence, The net income in variable costing is $95,400 which is lower than in absorption costing.

7 0
3 years ago
A. Money taken from your gross pay that you have no control over
zloy xaker [14]
1. Gross income - h. Total income before any deductions are taken

2. Net income - f. Take–home pay

3. Voluntary salary deduction - j. Money you have given

4. Involuntary salary deduction - a. Money taken from your gross pay that you have no control over

5. Fixed expenses - e. Expenditures that are constant from one time period to another

6. Discretionary spending  - b. Expenditures that are under your control

7. Fixed income - i. Income that does not vary from one time period to another

8. Principal - d. The initial amount of money that was invested or borrowed

9. Salaried employee - g. Someone who receives a regular salary for employment

10. Insolvent - c. Unable to discharge liabilities or repay debts
4 0
3 years ago
Maxtor Technology incurred the following costs during the year related to the creation of a new type of personal computer monito
Radda [10]

Answer:

Research and development expense is $679,000.

Explanation:

Creation of a new type of personal computer monitor is an internally generated intangible asset.

The Costs directly incurred in developing an internally generated intangible asset are all expensed until the intangible asset is technically physiable for operation.

Research and Development costs are thus expensed.

<u>Calculation of Research and Development Cost</u>

Salaries                                                                                        $240,000

Depreciation on R&D facilities and equipment                         $135,000

Utilities and other direct costs incurred for the R&D facilities  $ 68,000

Patent filing and related legal costs                                            $24,000

Payment to another company for  development work             $130,000

Costs of adapting the new monitor                                             $82,000

Total                                                                                             $679,000

Conclusion :

Research and development expense is $679,000.

3 0
3 years ago
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