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Alisiya [41]
3 years ago
6

Allowance for Doubtful Accounts has a credit balance of $500 at the end of the year (before adjustment), and bad debt expense is

estimated at 3% of credit sales. If credit sales are $300,000, the amount of the adjusting entry to record the estimated uncollectible accounts receivable is
Business
1 answer:
Ira Lisetskai [31]3 years ago
8 0

Answer:

Adjusting entry to record the estimated uncollectible accounts receivable is:

Debit Bad debt expense                                  $8,500

Credi Allowance for doubtful accounts          $8,500

<em>(To record bad debt expense for the year)</em>

Explanation:

The company uses percentage of credit sale to arrive at an estimated amount of accounts receivable that is deemed irrecoverable.

3% of credit sales of $300,000 = $9,000

Since there is an existing credit balance of $500 in the allowance for doubtful accounts, in order to reinstate the balance in that account to $9,000, we need to remove the existing balance from the calculated estimate. Therefore, $9,000 - $500 = $8,500 becomes the necessary adjustment to Bad debt expense.

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The classic quote from the movie Field of Dreams, "If you build (produce] it
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The correct answer is A. Say's Law

Explanation:

Say's Law proposed by the economist Jean-Baptiste Say establishes the supply (availability of a product) or the production itself is the factor that creates demand (customers willing to buy the product). For example, the production of a new model of cellphone or computer makes people want to buy the new model. This idea is expressed by the quote "If you build (produce] it  they will come [purchase]" because in the quote it is explained the production of something make people go to buy that product.

6 0
2 years ago
Kate's Diner offers one breakfast item, a breakfast special. The market price for this meal is $5. At her profit-maximizing leve
bazaltina [42]

Answer:

keep producing in the short run but exit the industry or go out of business in the long run

Explanation:

A perfect competition is characterised by many buyers and sellers of homogeneous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.  

In the long run, firms earn zero economic profit.  If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.  

Also, if in the short run, firms are earning economic loss, in the long run, firms would exit the industry until economic profit falls to zero.  

A firm should shut down in the short run if price is less than average variable cost. But since the diner's price is greater than average variable cost, it should continue production.

A firm should exit the industry in the long run if price is less than average total cost. the diner's price is less than average total cost, so it should shut down in the long run

6 0
3 years ago
Cor-Eng Partnership was formed on January 2, 20X1. Under the partnership agreement, each partner has an equal initial capital ba
inessss [21]

Answer:

Cor's share of Cor-Eng's 20X1 net income is $60,000

Explanation:

                                Partnership Table

                                               Cor$        Eng$        Total$

Ratio                                         60%        40%         100%

Assets                                  60,000      20,000     80,000

Goodwill                                                40,000      40,000

Initial Capital balance        60,000     60,000     120,000

Add: Net income                  15,000       10,000     25,000

Less: Drawing                      -3,000        -9,000     -12,000

Year End balance                 72,000      61,000    133,000

6 0
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Ymorist [56]
A. production era because there is limit
6 0
3 years ago
what are the main purposes of a budget? to record the past income and spending. to take a it a student loan from the bank. to pl
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I think its either to balance available resources and expenses or to plan future income and spending
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2 years ago
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