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Natali5045456 [20]
3 years ago
13

At the end of the year, Brinkley Incorporated’s balance of Allowance for Uncollectible Accounts is $3,500 (credit) before adjust

ment. The company estimates future uncollectible accounts to be 5% of credit sales for the year. Credit sales for the year total $130,000.What is the adjustment Brinkley would record for Allowance for Uncollectible Accounts using the percentage-of-credit-sales method?
Business
1 answer:
gayaneshka [121]3 years ago
3 0

Answer:

The adjustment Brinkley records for Allowance for Uncollectible Accounts using the percentage-of-credit-sales method:

Debit Bad debts expense $6,500

Credit Allowance for Uncollectible Accounts $6,500

Explanation:

Brinkley Incorporated’ uses the percentage-of-credit-sales method - application a flat percentage to the total amount of net credit sales for the period to  estimate uncollectible.

Estimated uncollectible = 5% x $130,000 = $6,500

The company records an Allowance for Uncollectible Accounts for $6,500 while simultaneously reporting $6,500 in bad debts expense. The  adjustment entry:

Debit Bad debts expense $6,500

Credit Allowance for Uncollectible Accounts $6,500

The balance in the  Allowance for Uncollectible Accounts after adjustment is $6,500 + $3,500 = $10,000

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Answer:

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That means that most of the players' salary raise was due to other factors, not just inflation.

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3 years ago
On May 7, Keenan Company purchased on account 620 units of raw materials at $21 per unit. During May, raw materials were requisi
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Answer:

Dr Material Inventory $13,020

Cr               Trade Payables $13,020

Dr Work In Progress $9,742

Cr Material Inventory       $9,742

Explanation:

On 7th May the double entry would be to record the inventory purchases on credit which would increase the inventory by $13,020 (620*21) as under:

Dr Material Inventory $13,020

Cr               Trade Payables $13,020

The material sent to production or manufacturing team would be recorded as increase in the work in progress by the value of the material issued which is $9,742 (211*$19 + 273*$21).

Dr Work In Progress $9,742

Cr Material Inventory       $9,742

8 0
3 years ago
Determinants of how long a firm should borrow money include?
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Determinants of long a firm should borrow money include are:

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⇒the cost of inventory

⇒the cash flow forecast

The term "capital structure" describes how a company decides to finance its projects and assets through a combination of internal resources, debt, and equity.

To lower their risk of insolvency, remain effective, and ultimately maintain or become profitable, a company should determine the ideal debt to equity ratio.

The capital structure of a company is influenced by a wide range of variables, including leverage or trading on equity, company growth, the nature and scale of the business, the desire to maintain control, the flexibility of the capital structure, investor requirements, the price to float new securities, the timing of the issue, the corporate tax rate, and the legal requirements.

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2 years ago
A married couple filing a joint tax return with combined income under $40,000 both contribute to their self-directed IRAs. Which
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The answer is: D) growth mutual funds

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3 years ago
Martin transfers real estate with an adjusted basis of $260,000 and fair market value of $350,000 to a newly formed corporation
katrin [286]

Answer:

$40,000

Explanation:

We can calculate recognized gain on the transfer and basis for his stock just by deducting adjusted basis value from liability on the transfered real estate.

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iability on the transfered real estate        $300,000

less: adjusted basis value                       ($260,000)

Gain recognized                                        $40,000

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3 years ago
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