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Mariulka [41]
2 years ago
12

Utopia Corporation provides $6,000 worth of lawn care on account during the month. Experience suggests that about 3% of net cred

it sales will not be collected. To record the potential bad debts, Utopia Corporation would debit:
a. Bad Debt Expense and credit Accounts Receivable for $180.
b. Accounts Receivable and credit Allowance for Doubtful Accounts for $180.
c. Bad Debt Expense and credit Allowance for Doubtful Accounts for $180.
d. Allowance for Doubtful Accounts and credit Bad Debt Expense for $180.
Business
1 answer:
photoshop1234 [79]2 years ago
6 0

Answer:

The answer is C.

Explanation:

Credit sales is $6,000

Bad debt is 3% of net credit sales which is $180($6,000 x3%)

Creating allowance for doubtful debt entry is one of the prudent method and it tells us that some customers won't pay part of what they are owing. And it is also a contra account that offset bad debt.

According to the accounting rule, debit increases asset and expenses and vice-versa while credit decreases liability, equity, income and vice versa.

So we have have:

Dr Bad debt expense $180

Cr Allowance for Doubtful Accounts $180

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An international children’s charity collects donations, which are used to buy clothing and toys for children in need. The charit
MatroZZZ [7]

Answer:

Required 1

<u>General Journal</u>

Cash $8,500 (debit)

Donations Revenue $8,500 (credit)

<em>Cash and Checks received as Donation Revenue</em>

<em />

Wages Expenses $3,000 (debit)

Cash $3,000 (credit)

<em>Wages to employee paid</em>

<em />

Note Payable $3,420 (debit)

Cash $3,420 (credit)

<em>Repayment of Short Term Loan</em>

<em />

Supplies $4,920 (debit)

Cash $2,080 (credit)

Note Payable $2,840 (credit)

<em>Purchase of Toys on cash and on credit</em>

<em />

Supplies $4,020 (debit)

Donations Revenue $4,020 (credit)

<em>Donations revenue received in form of Toy Supplies</em>

Required 2

Net Income is $9,520

Explanation:

<u>Calculation of Charity’s preliminary net income.</u>

Donations Revenue ($8,500 + $4,020)  $12,520

Less Expenses :

Wages                                                       ($3,000)

Net Income/ (Loss)                                    $9,520

7 0
3 years ago
Ruston Company had Net Income for 2020 of $6,200,000. The firm invested $4,000,000 in manufacturing equipment during 2020. The e
Aloiza [94]

Answer:

$3,000,000

Explanation:

Calculation to determine the Net Cash Flow in 2020

STATEMENT OF CASH FLOW

For the Year 2020

Cash flow from operating Activities:

Net Income $6,200,000

Add Depreciation Expense $ 800,000

Net Cash provided by operating activities $7,000,000

($6,200,000+$800,000)

Cash flow from Investing activities:

Investment in Equipment ($4,000,000)

Net Cash used in Investing activities ($4,000,000)

Net Cash flow in 2020 $3,000,000

Depreciation under Straight Line method = (Cost - Salvage Value)/Useful Life

Depreciation under Straight Line method= (4000000-0)/5

Depreciation under Straight Line method= 800,000

Therefore the Net Cash Flow in 2020 is $3,000,000

4 0
3 years ago
The following exchange demonstrates which problem-solving technique the issues we are having with the design is similar to the i
levacccp [35]

Answer: Question Assumptions

Explanation:

3 0
3 years ago
When you catch a fast-moving baseball with your bare hand, a good idea is to catch it so that your hand stops it?
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You want your hand to "give" a bit when you catch the ball. You don't want want the ball to come to a hard stop because that would risk hurting your hand.
4 0
3 years ago
Oriole Co. reports net income of $59,000. Partner salary allowances are Pitts $15,000, Filbert $5,000, and Witten $6,000. Indica
loris [4]

Answer:

Oriole Co

Division of net income to each partner:

                                     Pitts      Filbert       Witten      Total

Total income           $33,480   $13,580    $11,940  $59,000

Explanation:

a) Data and Calculations:

Net income = $59,000

Salary allowances = $26,000

Remaining shareable income = $33,000

Allocation of net income to each partner:

                                     Pitts      Filbert       Witten

Income sharing ratio    56     :     26      :      18

Salary Allowances    $15,000   $5,000    $6,000

Shareable income      18,480      8,580       5,940

Total income           $33,480   $13,580    $11,940

b) Calculation of shareable income:

Pitts = $33,000 * 56% = $18,480

Filbert = $33,000 * 26% = $8,580

Witten = $33,000 * 18% = $5,940

6 0
2 years ago
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