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zavuch27 [327]
3 years ago
11

During its first year of operations, Mack's Plumbing Supply Co. had sales of $550,000, wrote off $8,800 of accounts as uncollect

ible using the direct write-off method, and reported net income of $60,500. Determine what the net income would have been if the allowance method had been used, and the company estimated that 2.5% of sales would be uncollectible.
Business
1 answer:
vova2212 [387]3 years ago
3 0

Answer:

$60,500

Explanation:

With regards to the above, the write off does not affect the realizable value of accounts receivables. Also, the total asset or net income is not affected by the write off or specific account. Instead, both assets and net income are affected in the period when bad debt expense is predicted and then recorded with an adjusting entry.

Accounts receivables

$550,000

Less:

Allowance for doubtful account

($550,00 × 2.5%)

($13,750)

Estimated realizable accounts receivables

$536,250

If the amount of bad debt decreases or increases as given below, then the income is also increased or decreased by the amount given.

Bad debts = $13,750

Uncollectible previously written off = $8,800

Difference

$4,950

Net income

$60,500

Less:

Difference

($4,950)

Reported income

$55,550

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On February 22, Brett Corporation acquired 250 shares of its $3 par value common stock for $26 each. On March 15, the company re
Alex

Answer: Credit Additional Paid in Capital $198

Explanation:

Brett Corporation reissued the Treasury Stock at $29 which was $3 higher than the amount they had repurchased it for.

When stock is sold for a price higher or lower than they are worth, the balance goes to the Additional Paid-in Capital account. If it is sold higher, the balance is Credited to the Additional Paid-in Capital account and if it is sold for lower than it is worth, it is debited.

The Balance here is,

= $3 * 66 resold shares

= $198

This $198 will therefore be credited to the Additional Paid-in Capital account.

5 0
3 years ago
Leonardo, who is married but files separately, earns $90,000 of taxable income. He also has $8,750 in city of Tulsa bonds. His w
UkoKoshka [18]

Answer: 17.56%

Explanation:

Given that,

Leonardo taxable income = $90,000

Tulsa bonds = $8,750

Theresa taxable income = $50,000

Computation of Leonardo's Tax:

According to the tax rate schedule,

Total Tax = Tax + 24% of taxable income over $82,500

                = $14,089.50 + 24% × $7,500

                = $14,089.50 + $1,800

                = $15,889.5

Computation of Theresa's Tax:

According to the tax rate schedule,

Total Tax = Tax + 22% of taxable income over $38,700

                = $4453.50 + 22% × $11,300

                = $4453.50 + $2,486

                = $6939.5

Total tax on Leonardo's income and Theresa's income:

= $15,889.5 + $6939.5

= $22,829

Effective tax rate = \frac{Total\ Tax}{Total\ Taxable\ Income}\times100

                              = \frac{22,829}{130,000}\times100

                              = 17.56%

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3 years ago
What is the balance of the manufacturing overhead account and is overhead underapplied or overapplied at the end of the year?.
baherus [9]

The balance of the manufacturer overhead account is Credit of $30,000, overapplied.

  • credit of $30,000, overapplied.

<h3>Underapplied Overhead vs. Overapplied Overhead</h3>

Underapplied overhead is the opposite of overapplied overhead. Overapplied overhead occurs when expenses incurred are actually less than what a company accounts for in its budget. This means that a company comes in under budget and achieves a lower amount of overhead costs during the accounting period.

Therefore, the correct answer is as given above.

learn more about overhead account from here:

brainly.com/question/26396695

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2 years ago
In case you have to complete an application on site, you want to make sure you have your completed Personal Fact Sheet. Please s
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That would be true so you make sure you have all the correct info to put on the application
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3 years ago
Read 2 more answers
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