1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
lesantik [10]
3 years ago
15

All sales are made on credit. Based on past experience, the company estimates 1% of credit sales to be uncollectible. What adjus

ting entry should the company make at the end of the current year to record its estimated bad debts expense?
Business
1 answer:
fenix001 [56]3 years ago
5 0

Answer:

Debit : Bad Debts account : $2000 (appearing in the income statement)

Credit : Provision for doubtful debts account : $2000 (appearing in the balance sheet)

Explanation:

This is an example of provision for doubtful debts. Provision for doubtful debts is an estimated amount of bad debts from accounts receivables that has been issues but not yet collected. This is done under the accrual accounting concept where an expense is identified as soon as invoices have been issued rather than waiting long periods to find out which invoice is irrecoverable. It is typically an estimate based on past experience.

In this question, the sales value has not been provided, hence an assumption is made:

Sales : $200,000

If provision for doubtful debts is 1% of sales and all sales is on credit, then the provision for doubtful debts amount is = 1% x $200,000 = $2000

Provision for doubtful debts is an accounts receivable contra account and thus has a credit balance and is recorded in the balance sheet, listed directly under accounts receivables.

The entry is recorded as:

Debit : Bad Debts account : $2000 (appearing in the income statement)

Credit : Provision for doubtful debts account : $2000 (appearing in the balance sheet)

You might be interested in
URGENT 20poinThe income of the individual falls under one main category​
Zinaida [17]

Answer:

ok

Explanation:

ok what's the questioned

7 0
2 years ago
Read 2 more answers
This is a good question to ask during an interview A) How many vacation days do I get? B) What kind of products or services do y
jeka94

Answer:

C) How many hours of training will I need?

3 0
3 years ago
__________ is buying products from another country.
lisov135 [29]

The correct answer is (b) importing.

importer is buying products from another country.

<h3>What Exactly Is an Import?</h3>

An import is an item or service purchased in one nation but manufactured in another. The two pillars of global trade are imports and exports. if a nation's imports are more than its exports in value.

Free-trade agreements and a reliance on imports from nations with less expensive labor frequently appear to be the main causes of the reduction in manufacturing jobs in the importing country. Free trade makes it easier to import products and raw materials from regions with less expensive labor costs, which lessens the need for domestically produced items. Between 2000 and 2007, the effects on manufacturing jobs were noticeable, and the Great Recession and the subsequent slow recovery only made matters worse.

To know more about import and export visit:

brainly.com/question/1060159

#SPJ4

3 0
1 year ago
You need to earn 6% annul real rate of return and, in addition, you need to keep up with the annual inflation rate. Exactly 4 ye
Sever21 [200]

Answer:

"4,000" is the appropriate option.

Explanation:

Given:

Real interest rate,

= 6%

Inflation rate,

= 2%

Annual deposit,

= $20,000

Now,

The nominal interest rate will be:

= Real \ interest \ rate+Inflation \ rate

= 6+2

= 8 (%)

As per the annual deposit, I was making,

= 20000\times 0.6

= 1200 \ every \ year

Inflation rate rise 3% i.e.,

= 2+3

= 5 (%)

Just to earn 1200, I have to:

= \frac{1200}{0.05}

= 24,000

Thus the above is the appropriate answer.

4 0
3 years ago
Model, Inc., produces model automobiles made from metal. It operates two production departments, Molding and Painting, and has t
Vesnalui [34]

Answer:

Total Service Costs   Molding :350031.22 Painting:  205081. 46  

Explanation:

Given Data

<u><em>Model, Inc.</em></u>

<u><em>                                          Service </em></u>

<u><em>                    Administration,      Accounting,       Maintenance</em></u>

<u><em></em></u>

Costs                $269,000,         $402,000,         $199,000,

Building area     12,000            63,000                   69,300

Employees            44                     14                       22            

Equipment value

(in thousands)       $ 177.00        $ 236.00          $ 17.50      

                                <u>   Production </u>

<u>                         Molding                  Painting </u>

Costs

Direct Materials $242,500         $211,000

Direct Labor      $327,500           $219,000

Overheads        $105,000           $82,500

Building area       441,000            56,700

Employees           66                      88

Equipment value

(in thousands)      $ 118.00         $ 59.00

<em><u>First we find the activity rates for each cost using total cost driver except self usage</u></em>

1) Maintenance  $ 199,000

Equipment Value= 177 + 236+ 118+ 59=  590 ( in thousands)  ( all but maintenance itself )

Maintenance per equipment = 199,000/590,000=  0.3373 per equipment

2) Accounting,= $402,000,

Employees=44  + 22 + 66 + 88 =  220

Accounting per Employee=  $402,000,/220=  1827.27 per Employee

3) Administration= $269,000

Building area  =63,000 +69,300 +441,000+ 56,700= 630,000

Administration per square footage= 269,000/ 630,000= 0.4269= 0.43 per square

<u><em>Then we multiply the rates to find the service costs allocated.</em></u>

 Production

                        Molding                                     Painting

Costs

Direct Materials $242,500                               $211,000

Direct Labor      $327,500                                $219,000

Overheads        $105,000                                $82,500

<u>Service Cost Allocated</u>

Building area       0.43*441,000                   0.43* 56,700

                             = 189630                             =24381

Employees           66* 1827.27                      88 *1827.27

                            = 120599.82                      = 160799.76

Equipment value

(in thousands)      $ 118.00* 0.3373               $ 59.00 *0.3373

<u>                                  </u><u>= 39801.4                          = 19900.7               </u>

<u>Total Service Costs  350031.22                           205081. 46        </u>

<u>Total  Costs              1025031.22                           717581. 46    </u>

<u />

6 0
3 years ago
Other questions:
  • What voting system is preferred by voting rights activists as a means of increasing minority representation?
    8·1 answer
  • An investor just purchased a 10-year, $1,000 par value bond. the coupon rate on this bond is 8 percent annually, with interest b
    9·1 answer
  • When a scientific number is the result of a measurement using equipment such as a balance, the last digit is ______?
    13·1 answer
  • What is one main objective in the studies of economics
    8·2 answers
  • As a result of conducting a gap analysis, the potential entrepreneur proved there was a need for the business. This is called do
    12·1 answer
  • For​ 2018, Winters Manufacturing uses machineminushours as the only overhead costminusallocation base. The direct cost rate is $
    11·1 answer
  • The following data relate to a company that produces and sells a travel guide that is updated monthly: Each book sells for $20.0
    13·1 answer
  • Camper's Edge Factory produces two products: canopies and tents. The total factory overhead is budgeted at $750,000 for the year
    15·1 answer
  • 3. During Michael Jordan's NBA career (
    14·1 answer
  • How does gross taxable income and adjusted gross income differ between the two?
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!