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poizon [28]
3 years ago
5

As of December 31, 2020, Gill Co. reported accounts receivable of $216,000 and an allowance for uncollectible accounts of $8,400

. During 2021, accounts receivable increased by $22,000 (that change includes $7,800 of bad debts that were written off). An analysis of Gill Co.'s December 31, 2021, accounts receivable suggests that the allowance for uncollectible accounts should be 3% of accounts receivable. Bad debt expense for 2021 would be
Business
1 answer:
Strike441 [17]3 years ago
5 0

Answer:

$6,540

Explanation:

Accounts receivable at 12/31/2022:

= Accounts receivable at 12/31/2021 + Increase

= $216,000 + $22,000

= $238,000

Uncollectible accounts receivable:

= 3% of Accounts receivable at 12/31/2022

= 0.03 × $238,000

= $7,140

Allowance = Allowance at 12/31/2021 - Writes Off

                  = $8,400 - $7,800

                  = $600

Therefore,

Bad debt expense for 2021 would be:

= Uncollectible accounts receivable - Allowance

= $7,140 - $600

= $6,540

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6 0
3 years ago
Forrester Company is considering buying new equipment that would increase monthly fixed costs from $120,000 to $150,000 and woul
Margarita [4]

Answer:

"Decrease by 250" is the appropriate response.

Explanation:

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=  \frac{Revised \ fixed \ cost}{Revised \ contribution}

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=  3750 \ units

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4 0
3 years ago
You just won $30,000 and deposited your winnings into an account that pays 3.9 percent interest, compounded annually. how long w
ruslelena [56]
For this case we have an equation of the form:
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During reconstruction, a major economic development in the south was the:
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