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Serjik [45]
3 years ago
11

Larkspur, Inc. had net sales in 2020 of $1,447,100. At December 31, 2020, before adjusting entries, the balances in selected acc

ounts were Accounts Receivable $204,600 debit, and Allowance for Doubtful Accounts $1,940 debit. Assume that 11% of accounts receivable will prove to be uncollectible. Prepare the entry to record bad debt expense.
Business
1 answer:
Zielflug [23.3K]3 years ago
6 0

Answer:

The entry to record bad debt expense:

Debit Bad debts expense $24,446

Credit Allowance for Doubtful Accounts $24,446

Explanation:

1. At December 31, 2020,

Bad debt are estimated: 11% x $204,600 = $22,506

Before adjusting, Allowance for Doubtful Accounts had a debit balance of $1,940. So Bad debt expense will be: $1,940 + $22,506 = $24,446

The adjustment to record Bad debt expense and Allowance for Doubtful Accounts:

Debit Bad debts expense $24,446

Credit Allowance for Doubtful Accounts $24,446

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The residual income for the Division A of Magnolia Company for an income from operations of $80,000 will be $32,000.

<h3>What is residual income?</h3>

Residual Income is the total of total income from operations less the minimum acceptable rate of return on the deployed assets for such operations over a financial period.

Using the above information, it can be ascertained that the residual income will be,

\rm Residual\ Income = Income\ from\ Operations - Rate\ of\ Return\ x\ Assets\\\rm Residual\ Income = 80000- (12\%\ x\ 400000)\\\\\rm Residual\ Income = \$32,000

Hence, the residual income will be as computed above.

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What is a price ceiling?why would a price ceiling be put at good service
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A simple definition of curriculum?
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The following transactions occur for the Wolfpack Shoe Company during the month of June:
inessss [21]

Answer:

Please see the attached snapshots for the answers.

Explanation:

a.

Debit: Cash $30,000

Credit: Service Revenue $30,000

To record Service Revenue.

b.

Debit: Supplies $20,000

Credit: Accounts Payable $20,000

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Sunland Company had the following department data: Physical Units Work in process, beginning 0 Completed and transferred out 909
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Answer:

Equivalent units of production= 98,700

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Giving the following information:

Physical Units Work in process, beginning 0

Completed and transferred out 90,900

Work in process, ending 7,800

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<u>To calculate the equivalent units, we need to use the following formula:</u>

<u></u>

Units completed in the period + Equivalent units in ending inventory WIP (units*%completion) = Equivalent units of production

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