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charle [14.2K]
2 years ago
9

At December 31, Folgeys Coffee Company reports the following results for its calendar year. Cash sales $ 901,000 Credit sales 30

1,000 Its year-end unadjusted trial balance includes the following items. Accounts receivable $ 126,000 debit Allowance for doubtful accounts 5,100 debit Prepare the adjusting entry to record bad debts expense assuming uncollectibles are estimated to be (a) 4% of credit sales, (b) 2% of total sales and (c) 7% of year-end accounts receivable.
Business
1 answer:
Anon25 [30]2 years ago
5 0

Answer:

Please find the detailed answer in the explanation section.

Explanation:

A. 4% of credit sales

Bad Debts Expense is 4% of $301,000

0.04 x $301,000

=$12,040

Adjusting entry

Dec. 31

Dr Bad debt expense $12,040

Cr Allowance for Doubtful allowance $12,040.

B. 2% of total sales

Total sales = cash sales + credit sales

$ 901,000 + $ 301,000

=$1,202,000

Bad Debts Expense is 2% of 1,202,000

0.02x $1,202,000

=$24,040

Adjusting entry

Dec. 31

Dr Bad debt expense $24,040

Cr Allowance for Doubtful allowance $24,040.

C. 7% of year-end accounts receivable.

Unadjusted balance is $5,100

Estimated balance = $8,820(7% of $126,000)

Adjusted balance is $13,920($5,100 + $8,820)

Adjusting entry

Dec. 31

Dr Bad debt expense $8,820

Cr Allowance for Doubtful allowance $8,820

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Richard suspects his supervisor of unethical accounting practices. However, hedoes not want to lose his job if he reports the su
Jobisdone [24]

Answer: The employee reporting the unethical behavior can do so anonymously.

Explanation:

Richard can make use of the anonymous user account to report his supervisor's unethical behavior, that way the company can be made aware of the supervisor's wrong behavior and Richard's identity would be kept safe that way he doesn't loss his job.

7 0
3 years ago
The Closed Fund is a closed-end investment company with a portfolio currently worth $200 million. It has liabilities of $3 milli
iragen [17]

Answer:

$39.40

Explanation:

According to the situation, the solution is as follows

The Net asset value of the fund is

= (Current worth of portfolio - liabilities) ÷ (outstanding shares)

= ($200 million - $3 million) ÷ (5 million shares)

= $39.40

Basically we applied the above formula in order to determine the net asset value of the fund.

8 0
3 years ago
The following situations should be considered independently. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $
Naddika [18.5K]

Answer:

1. John Jamison Approximately how long will it take John to reach his goal?

8.

2. Jasmine Company What is the interest rate implicit in this agreement?

8,77%

3. Sam Robinson What is the annual payment Sam must make to pay back his friend?

2416,815107

Explanation:

                          PV          x Int Rate x+int.rate N y    y*PV  

1. John Jamison 30000 1 10%          110% 8 2,143 64307,6643 64307

       

2.Jasmine Company N Monthly principal interest Net value    

    33.494    

1 6.000 3.062 2.937 30.432    

2 6.000 3.331 2.669 27.101    

3 6.000 3.623 2.377 23.477    

4 6.000 3.941 2.059 19.536    

5 6.000 4.287 1.713 15.250    

6 6.000 4.662 1.337 10.587    

7 6.000 5.071 929 5.516    

8 6.000 5.516 484 0    

       

       

Loan 33494      

Monthly: 8      

Interest: 8,77%      

Monthly payment 6.000      

       

3. Sam Robinson N Monthly principal interest Net value    

                                                       15000    

1 2416,815107 766,815107 1650         14233,18489    

2 2416,815107 851,1647687 1565,650338 13382,02012    

3 2416,815107 944,7928933 1472,022214 12437,22723    

4 2416,815107 1048,720112 1368,094995 11388,50712    

5 2416,815107 1164,079324 1252,735783 10224,4278    

6 2416,815107 1292,128049 1124,687058 8932,299746    

7 2416,815107 1434,262135 982,5529721 7498,037611    

8 2416,815107 1592,03097 824,7841372 5906,006641    

9 2416,815107 1767,154376 649,6607306 4138,852265    

10 2416,815107 1961,541358 455,2737492 2177,310907    

11 2416,815107 2177,310907 239,5041998 0    

5 0
2 years ago
Which of the following conditions distinguishes monopolistic competition from perfect competition? a. the freedom of entry and e
MariettaO [177]

Answer:

d)product differentiation

Explanation:

monopolism is when only one producer in the area produces the good/service thus there is no competition eg power supply company while perfect competition is when same type of products but different styles are produced making the business environment competitive.

6 0
3 years ago
Ann hires a nanny to watch her two children while she works at a local hospital. She pays the 19-year-old nanny $170 per week fo
aksik [14]

Answer:

Nanny's Portion of Social Security is $442.68  

Ann's Portion of Social Security Tax is $442.68

Nanny's Portion of Medicare Tax is $103.53  

Ann's Portion of Medicare Tax is $103.53

Explanation:

As explained by the Internal Revenue Service (IRS) under "Topic No. 751 Social Security and Medicare Withholding Rates", the social security tax rate are 6.2 percent for the employer and 6.2 percent for the employee, while the Medicare rate for employee is 1.45 percent and it is also 1.45 percent for the employer. In addition, the wage base limit for 2020 social security tax is $137,700.

Base on the above, we proceed as follows:

Step 2: Calculation total salary of nanny

Total salary of nanny = weekly rate × number of weeks worked

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                                   = $7,140

Step 2: Calculation of social security tax

Since the nanny's salary is below the wage base limit of $137,700, the tax rates are applied to the actual salary of $7,140 as follows:

Nanny's Portion of Social Security Tax = $7,140 × 6.2% = $442.68  

Ann's Portion of Social Security Tax = $7,140 × 6.2% = $442.68

Step 3: Calculation of Medicare tax

Since there is no wage base limit for Medicare tax, the tax rates are applied to the actual salary of $7,140 as follows:

Nanny's Portion of Medicare Tax = $7,140 × 1.45% = $103.53  

Ann's Portion of Medicare Tax = $7,140 × 1.45% = $103.53

6 0
3 years ago
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