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iragen [17]
3 years ago
15

Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded

only at December 31, the company’s fiscal year-end. The 2020 balance sheet disclosed the following:
Current assets:
Receivables, net of allowance for uncollectible accounts of $36,000 $ 462,000


During 2021, credit sales were $1,780,000, cash collections from customers $1,860,000, and $41,000 in accounts receivable were written off. In addition, $3,600 was collected from a customer whose account was written off in 2020. An aging of accounts receivable at December 31, 2021, reveals the following:

Percentage of Year-End Percent
Age Group Receivables in Group Uncollectible
0−60 days 70% 5%
61−90 days 20 15
91−120 days 5 20
Over 120 days 5 40

Prepare summary journal entries to account for the 2021 write-offs and the collection of the receivable previously written off.
Business
1 answer:
Sedaia [141]3 years ago
5 0

Journal entries

Dr Allowance for uncollectible account $41,000

Cr Account Receivable $41,000

Dr Account receivable $3,600

Cr Allowance for uncollectible account $3,600

Dr Cash $3,600

Cr Account receivable $3,600

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What are the potential risks of having all three of these buckets (savings, investments and debt payments) belong in the same ca
Vlad [161]

The potential risks that these three groups fall into the same category is that it is a low percentage and it is not a realistic proposition.

According to the theory of 50, 20, 30, a person's salary should be divided into 3 buckets that are:

  • 50% of salary must go towards mandatory expenses (housing rent payments, utilities, medical care, basic food, and transportation).
  • 20% of the salary must be used for savings and debt payments (programmed savings for old age or a special event, or the payment of debts such as card payments, bank loans, among others).
  • 30% of the salary must be allocated for non-priority expenses (it is the expenditure of money on experiences, objects, or others that are not essential for the individual).

This income distribution is unrealistic because most people spend more than 50% of their salary on compulsory expenses, reducing their economic capacity for other purposes.

In this way, the 20% destined to savings and payment of debts would be a minimum amount of the salary, which could have serious consequences such as:

  • Inability to pay debts
  • Inability to save for the future

Learn more in: brainly.com/question/12198015

5 0
3 years ago
Based on his investment advisor's guidance, Christopher sold two stocks during 2020. The capital gain on the sale of Magnificent
Mamont248 [21]

Answer:

The question is incomplete since we are not told if the capital gain is a short or long term gain. So I will answer the question in both possible scenarios.

Short term capital gains:

They are taxed as ordinary income, so the net gain = $35,000 - $7,000 = $28,000

Net gain after taxes = $28,000 x (1 - 53.31%) = $13,073.20

Long term capital gains:

They are taxed at a much lower rate that ranges from 0 to 20%. In this case, Christopher is probably taxed at 20%.

Net gain after taxes = $28,000 x (1 - 20%) = $22,400

Explanation:

6 0
3 years ago
When a movie theater charges a lower ticket price for senior citizens and/or students, the movie theater is engaging in_________
MariettaO [177]

Answer:

b) third-degree price discrimination.

Explanation:

The price gouging happens on prices when is carried out by the seller, goods, services or goods to a higher level than what is considered acceptable or fair and potentially considered unethically. This usually occurs after a demand or supply shock. Common examples include price increases for basic needs after hurricanes or other natural disasters.

First-degree discrimination (perfect price discrimination) appears when a business charges the maximum possible price for each unit consumed because prices are diverse among some units. In this case, where a company charges a different price for every good or service sold.

Second-degree price discrimination is the concept in which a company charges a different price when there are demands for different quantities consumed, such as quantity discounts on bulk purchases.

Third-degree price discrimination is the case in which a company charges a different price to different consumer groups. This is the type of most common type of price discrimination. If we see in the question there is given distinctive ticket price offers to senior citizens and/or students. That’s why we should choose third-degree price discrimination.

8 0
3 years ago
Jackson is buying a home for $412,000. his interest rate on the loan will be 4.75or 15 years. he will have a down payment of $16
Ipatiy [6.2K]

Answer:

96%

Explanation:

Value of the home: $412,000-Down Payment $16,480 = $395,520

Formula for LTV(Loan to Value Ratio): Loan Amount / Appraised Property Value

LTV: $395,520/$412,000 = 0.96 or 96%

4 0
2 years ago
Wilcox Company has budgeted sales volume of 60,000 units and budgeted production of 54,000 units, while 10,000 units are in begi
VARVARA [1.3K]

Answer:

4,000 units

Explanation:

Given that

Sales volume = 60,000 units

Budgeted production = 54,000 units

Beginning finished goods = 10,000 units

The computation of units for ending finished goods inventory is computed below:-

Budgeted production = Ending finished goods + Sales volume - Beginning finished goods

54,000 = Ending finished goods + 60,000 - 10,000

54,000 = Ending finished goods + 50,000

= 4,000 units

6 0
3 years ago
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