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alukav5142 [94]
3 years ago
8

During 2021, its first year of operations, Pave Construction provides services on account of $152,000. By the end of 2021, cash

collections on these accounts total $106,000. Pave estimates that 30% of the uncollected accounts will be uncollectible. In 2022, the company writes off uncollectible accounts of $12,420. Required: 1. Record the adjusting entry for uncollectible accounts on December 31, 2021. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) 2-a. Record the write-off of accounts receivable in 2022. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) 2-b. Calculate the balance of Allowance for Uncollectible Accounts at the end of 2022 (before adjustment in 2022). 3-a. Assume the same facts as above but assume actual write-offs in 2022 were $18,630. Record the write-off of accounts receivable in 2022. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) 3-b. Assume the same facts as above but assume actual write-offs in 2022 were $18,630. Calculate the balance of Allowance for Uncollectible Accounts at the end of 2022 (before adjustment in 2022).
Business
1 answer:
Softa [21]3 years ago
6 0

Answer:

  • 1. Record the adjusting entry for uncollectible accounts on December 31, 2021.

Dr Bad Debt Expense $ 13.800  

Cr Allowance for Uncollectible Accounts  $ 13.800

  • 2-a. Record the write-off of accounts receivable in 2022.

Dr Allowance for Uncollectible Accounts $ 12.420  

Cr Accounts Receivable   $ 12.420

  • 2-b. Calculate the balance of Allowance for Uncollectible Accounts at the end of 2022

Final Balance 2022  

Cr Allowance for Uncollectible Accounts  $ 1.380

  • 3-a. Assume the same facts as above but assume actual write-offs in 2022 were $18,630. Record the write-off of accounts receivable in 2022.

Dr Allowance for Uncollectible Accounts $ 18.630  

Cr Accounts Receivable   $ 18.630

  • 3-b. Assume the same facts as above but assume actual write-offs in 2022 were $18,630. Calculate the balance of Allowance for Uncollectible Accounts at the end of 2022

Final Balance 2022  

Cr Allowance for Uncollectible Accounts  $ 7.176

Explanation:

Initial Balance  

Dr Accounts Receivable   $ 152.000

Cash collections on these accounts total $106,000  

Dr CASH $ 106.000  

Cr Accounts Receivable   $ 106.000

New Balance

Dr Accounts Receivable   $ 46.000

Pave estimates that 30% of the uncollected accounts will be uncollectible.  

Dr Bad Debt Expense $ 13.800  

Cr Allowance for Uncollectible Accounts  $ 13.800

 

FINAL BALANCE 2021  

Dr Accounts Receivable   $ 46.000

Cr Allowance for Uncollectible Accounts  $ 13.800

In 2022, the company writes off uncollectible accounts of $12,420  

Dr Allowance for Uncollectible Accounts $ 12.420  

Cr Accounts Receivable   $ 12.420

Final Balance 2022  

Dr Accounts Receivable  $ 33.580  

Cr Allowance for Uncollectible Accounts  $ 1.380

2-b. Calculate the balance of Allowance for Uncollectible Accounts at the end of 2022    

Dr Bad Debt Expense $ 10.074  

Cr Allowance for Uncollectible Accounts  $ 10.074

a. Assume the same facts as above but assume actual write-offs in 2022 were $18,630.    

Record the write-off of accounts receivable in 2022.  

Dr Allowance for Uncollectible Accounts $ 18.630  

Cr Accounts Receivable   $ 18.630

3-b. Assume the same facts as above but assume actual write-offs in 2022 were $18,630.  

Calculate the balance of Allowance for Uncollectible Accounts at the end of 2022  

Final Balance 2022  

Dr Accounts Receivable  $ 14.950  

Cr Allowance for Uncollectible Accounts  $ 7.176

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