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weeeeeb [17]
3 years ago
15

Abbott Company uses the allowance method of accounting for uncollectible accounts. Abbott estimates that 3% of credit sales will

be uncollectible. On January 1, the Allowance for Doubtful Accounts had a credit balance of $3,700. During the year, Abbott wrote-off accounts receivable totaling $2,700 and made credit sales of $118,000. After the adjusting entry, the December 31 balance in Bad Debt Expense would be
a. $4,540
b. $3,540
c. $3,700
d. $7,240
Business
1 answer:
defon3 years ago
4 0

Answer:

$2,540

Options are inconsistent with given question

Explanation:

Allowance for uncollectible accounts is a contra asset account and it has credit nature. It needs to be debited to decrease the balance and credited to increase the balance. Balance of this account is adjusted in the account receivable to report the net receivable balance in the balance sheet.

As per given data

Beginning allowance for uncollectible accounts balance = $3,700

Write off is the adjustment mad in this account and it needs to be debited in this account, this transaction will reduce the balance.

Adjusted Balance = $3,700 - 2,700 = $1,000

Credit sales = $118,000

Estimated allowance for uncollectible accounts balance = $118,000 x 3% = $3,540

As allowance for uncollectible accounts has already have balance of $1,000, Bad debt expense for the year is $2,540 ($3,540 - $1,000).

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Ivan

Answer:

Option C. It provided individual incentives; now it provides organizational incentives.

Explanation:

The reason is that incentives were previously assessed on the individual performance and now changing it to stock option reflects that if the whole of the organization will perform well then all of them will benefit from the increase in the value of the company shares which benefits employee, organization and the shareholders as well.

3 0
3 years ago
eggy's Pillows produces and sells a decorative pillow for $75.00 per unit. In the first month of operation, 2,000 units were pro
vivado [14]

Answer:

Total cost of goods sold per unit is $35,000

Explanation:

Given Data:

cost for decorative pillow =$75.00 per unit

Total sold unit = 1750

Per unit manufacturing cost

we know that  Variable Costing includes only manufacturing cost

Therefore, the total cost of goods as per variable costing can be computed as follow  

$20 \times  1750 = $35,000

The total cost of goods sold per unit is $35,000

4 0
3 years ago
Arbitration places a dispute before a third party for a binding settlement. true or false
kenny6666 [7]
<em />It is true that arbitration places a dispute before a third party for a binding settlement. 
4 0
3 years ago
In a bill-and-hold arrangement, revenue only can be recognized after the sale of the goods to the end user.
Verdich [7]

The correct answer is True. When ownership of the items passes to the customer, revenue is realised. In addition to the requirements for determining when control transfers, a reporting entity must also satisfy certain additional requirements for a customer to have achieved control in a bill-and-hold arrangement.

A bill and hold sales arrangement allows for payment in advance of the item's delivery. This is a sales agreement when a product seller invoices a consumer up front but doesn't actually ship the thing until later.

In a bill and hold transaction, the vendor does not deliver the purchased goods to the customer, but the associated income is still recorded. Under this structure, revenue cannot be recognised until a number of severe requirements have been satisfied. The possibility of falsely recognising revenue too early exists otherwise.

To learn more on bill and hold arrangement

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8 0
1 year ago
What is always true about trial balance reports? (You may select more than one answer. Single click the box with the question ma
Keith_Richards [23]

Answer:

The correct answers are letters "A", "C" and "D": All accounts with balances are included in the report; The report is prepared for a range of dates; The total of the debit column must equal the total of the credit column.

Explanation:

A Trial Balance is a worksheet detailing the debit and credit balances of all the accounts for the company. According to accounting theory, the sum of all debits will be the sum of all credits for a given period. Relevant accounting activity of previous periods can be included. Since the trial balance is a list of all accounts, it acts as a test of accuracy.

8 0
3 years ago
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