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Alekssandra [29.7K]
3 years ago
11

Exercise 5-66 Bad Debt Expense: Percentage of Credit Sales Method Gilmore Electronics had the following data for a recent year:

Cash sales $135,000 Credit sales 512,000 Accounts receivable determined to be uncollectible 9,650 The firm's estimated rate for bad debts is 2.2% of credit sales. Required: 1. Prepare the journal entry to write off the uncollectible accounts.
Business
1 answer:
Stels [109]3 years ago
5 0

Answer:  Debit Bad debt expense $11,264, Credit Allowance for bad debt $11,264; Debit Allowance for bad debt $9,650, Credit Accounts receivable $9,650.

Explanation: Percentage of credit sales method means bad debt expense expressed as a percentage of sales.

The estimated bad debts rate is 2.2%, which translates to 2.2% of $512,000 (credit sales) = $11,264. The firm has to record this, being the estimated bad debts rate, as Debit to bad debt expense and Credit to allowance for bad debt. However, accounts receivable that was deemed uncollectible is $9,650. This amount would be taken out from the buffer in allowance account by debiting allowance for bad debt and crediting accounts receivable.

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Sunspot Beverages, Ltd., of Fiji uses the weighted-average method in its process costing system. It makes blended tropical fruit
ddd [48]

Answer:

A. Material 200,000

Conversion 170,000

B. Materials $ 1.80

Conversion $ 1.55

C. Cost of units completed and transferred out $288,000 $ 248,000 $ 536,000

D. Cost of beginning work in process inventory $50,000

Costs added to production during the period $573,500

Explanation:

A. Calculation for the Blending Department's equivalent units of production for materials and conversion in June.

Equivalent units of production:

Materials

Transferred to next department

160,000

Equivalent units in ending work in process inventory:

Materials: 40,000

(40,000 units × 100% complete )

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Transferred to next department

160,000

Add Conversion10,000

40,000 units × 25% complete

Equivalent units of production 170,000

B. Calculation for the Blending Department's cost per equivalent unit for materials and conversion in June.

Cost per equivalent unit:

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Cost of beginning work in process $25,200 $24,800

Cost added during the period 334,800 238,700

Total cost $360,000 $263,500 (a)

Equivalent units of production

200,000 170,000 (b)

Cost per equivalent unit (a) ÷ (b) $ 1.80 $ 1.55

Materials =($360,000÷200,000=$ 1.80)

Conversion=($263,500÷170,000=$ 1.55)

C. Calculation for the Blending Department's cost of ending work in process inventory for materials, conversion, and in total for June.

Materials Conversion Total

Ending work in process inventory:

Equivalent units 40,000 10,000

Cost per equivalent unit $1.80 $1.55

Cost of ending work in process inventory $72,000 $15,500 $ 87,500

Units completed and transferred out:

Units transferred to the next department 160,00 160,000

Cost per equivalent unit $1.80 $1.55

Cost of units completed and transferred out $288,000 $ 248,000 $ 536,000

D. Preparation of a cost reconciliation report for the Blending Department for June

Cost of beginning work in process inventory $50,000

($25,200 + $24,800)

Costs added to production during the period $573,500

($334,800 + $238,700)

3 0
3 years ago
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<h3>What is a regressive tax system?</h3>

A regressive tax system is one where taxpayers pay a disproportionate share of the tax burden, given their earning levels.

A regressive tax system is not proportional or progressive.

2. An example of an excise tax is (b) tax on perfume.

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9. The ultimate tax-burden bearer in question 8 is <u>(d) the tenants</u>.

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Thus, while income tax is mostly progressive in the United States, sales taxes are proportional, while some taxes are regressive because the amount paid is fixed and does not depend on the ability-to-pay principle.

Learn more about tax systems at brainly.com/question/12890967

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2 years ago
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