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ICE Princess25 [194]
3 years ago
10

At the end of 2017, Grouper Company has accounts receivable of $916,100 and an allowance for doubtful accounts of $42,400. On Ja

nuary 16, 2018, Grouper Company determined that its receivable from Ramirez Company of $6,330 will not be collected, and management authorized its write-off. Prepare the journal entry for Grouper Company to write off the Ramirez receivable.
Business
1 answer:
Gennadij [26K]3 years ago
8 0

Answer:

Since the debt has already been provided for by Debiting bad debt expense $42,400 and Crediting Allowance for doubtful debt $42,400, the entries required to write off the debt from Ramirez Company of $6,330 will be

Debit Allowance for doubtful debt $6,330

Credit Accounts receivable $6,330

Being entries to writeoff debt due Ramirez Company of $6,330

Explanation:

When a company makes sales on account, debit accounts receivable and credit sales. Based on assessment, some or all of the receivables may be uncollectible.  

To account for this, debit bad debit expense and credit allowance for doubtful debt. Should the debt become uncollectible (i.e go bad), debit allowance for doubtful debt and credit accounts receivable.

Where a debit that had previously been determined to have gone bad gets settled, debit cash and credit bad debt expense.

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3 years ago
Tanner-UNF Corporation acquired as a long-term investment $240million of 6% bonds, dated July 1, on July 1, 2018. The marketinte
horrorfan [7]

Answer:

Journal Entry

01 July Debit Investment $240 million Credit Bank $200 million Credit Discount on investment $40 million

31 Dec Debit Bank $7,2 Million Debit Discount on Bond $0.8 million Credit Interest Income $8 million

Debit Fair Value loss on investment $30 million Credit Investment $30 million

Explanation:

Interest is received semiannually

6%/2 = 3%

interest = $240 million * 3% =7,200,000

8%/2 = 4%

Interest market $200 million * 4% =8,000,000

Fair value loss = 240 million - 210 million

                        = 30 million loss because cost is greater than fair value

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3 years ago
When she finishes entering her transactions, adrienne realizes that her balance is incorrect. assuming that adriennes beginning
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3 years ago
Read 2 more answers
Navajo Corporation traded a used truck (cost $20,000, accumulated depreciation $18,000) for a small computer with a fair value o
UNO [17]

Answer:

Dr Computer                                       $3,300

Dr Accumulated depreciation-Truck $18,000

Cr Truck - Fixed Asset                                              $20,000

Cr Gain on disposal of truck (Balancing Figure)    $800

Cr Cash  Account                                                       $500

Explanation:

The disposal of a Fixed asset is a three step procedure and is given as under:

  1. Remove the Accumulated depreciation and the cost of the fixed asset
  2. Record the receipt of the consideration at Fair Value
  3. Record the payment or receipt of the cash

Always remember that the balancing figure will go to Profit and loss statement.

<u>Step1: Remove the Accumulated depreciation and the cost of the fixed asset</u>

The asset value and the accumulated depreciation would be removed from the books of accounts and the balance figure would be transfered to profit and loss account.

Dr Accumulated Depreciation $18,000

Dr Profit & Loss Account          $2,000

Cr Truck - Fixed Asset                            $20,000

<u></u>

<u>Step2: Record the receipt of the consideration at Fair Value</u>

Dr Computer - Fixed Asset $3,300

Cr Profit and Loss Account           $3,300

<u>Step3: Record the payment or receipt of the cash</u>

The receipt of the payment will treated as:

Dr Profit and loss Account $500

Cr Cash Account                        $500

The aggregate Effect if I summarizee would be:

Dr Computer                                       $3,300

Dr Accumulated depreciation-Truck $18,000

Cr Truck - Fixed Asset                                              $20,000

Cr Gain on disposal of truck (Balancing Figure)    $800  

Cr Cash  Account                                                       $500

8 0
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Answer:

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Explanation:

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