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Komok [63]
3 years ago
5

Prepare journal entries for each transaction listed. (If no entry is required for a transaction/event, select "No Journal Entry

Required" in the first account field.)
At the end of June, bad debt expense is estimated to be $12,800.
In July, customer balances are written off in the amount of $6,400.

1) Record the estimated bad debt expense of $12,800.2) Record the customer balances written off in the amount of $6,400.
Business
1 answer:
AysviL [449]3 years ago
7 0

Answer:

The journal entries are shown below:

Explanation:

According to the scenario, the journal entries for the given data are as follows:

(1). Jun.30   Bad Debt expense A/c Dr $12,800

                   To Allowance for Doubtful A/c $12,800

                    (Being the bad debt expense is recorded)

(2). July       Allowance for Doubtful A/c Dr $6,400

                   To Accounts Receivable A/c $6,400

                    (Being the customer balance written off is recorded)

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Brown Street Grocers has a cost of equity of 11.8 percent, a pre-tax cost of debt of 6.9 percent, and a tax rate of 35 percent.
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Answer:

The correct answer to the following question is option E) 9.06% .

Explanation:

Here the cost of equity given is  - 11.8%

Pre tax cost of debt- 6.9%

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So the after tax cost of debt - 6.9% x 65%

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So the weight of debt - .6 / ( 1 + .06 )

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Weighted average cost of capital =

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= 4.485 x .375 + 11.8 x .625

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