Most of the times when a personnel is sent for an official business trip, transportation and lodging, and sometimes even meals are shouldered by the company.
In the statement given above, it is noted that the meals that Melissa took are considered personal in nature. Hence, she can deduct this from the business expenses.
The correct answer is that there was $3,080 worth of office supplies purchased during the period.
In order to answer this question you know that the company started with $630 worth of office supplies and ended the year with $460 worth, or $170 less than they started with. The company used $170 of supplies from inventory, so they needed to purchase another $3,080 in order arrive at the $3,250 that we know was the total expense during the reporting period.
To have a fundamental and legal basis, there should always be a purchase contract between the buyer and the seller. This contract contains the agreement and requirements for the purchase to proceed. So in this case, it is always agreed in the contract who pays the cost.
Answer:
a. $25,650
b. Journal entries
Explanation:
The computation is shown below:
a. The balance of the Allowance for Doubtful Accounts is
= Total account receivable × estimated percentage
= $570,000 × 4.5%
= $25,650
b. The adjusting entry is as follows
Bad Debt Expense $13,650 ($25,650 - $12,000)
To Allowance for Doubtful Accounts $13,650
(Being the bad debt expense is recorded)
c. The adjusting entry is as follows
Bad Debt Expense $26,650 ($25,650 + $1,000)
To Allowance for Doubtful Accounts $26,650
(Being the bad debt expense is recorded)
