Question

During 2021, its first year of operations, Pave Construction provides services on account of $160,000. By the end of 2021, cash collections on these accounts total $110,000. Pave estimates that 25% of the uncollected accounts will be uncollectible. In 2022, the company writes off uncollectible accounts of $10,000. Required:1. Record the adjusting entry for uncollectible accounts on December 31, 2021. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)2-a. Record the write-off of accounts receivable in 2022. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)2-a. Record the write-off of accounts recelvable In 2022 (if no entry is required for a particular transaction/event, select2-b. Calculate the balance of Allowance for Uncollectible Accounts at the end of 2022 (before adjustment in 2022).2-b. Calculate the balance of Allowance for Uncollectible Accounts at the end of 2022 (before adjustment In 2022) Beginning B3-a. Assume the same facts as above but assume actual write-offs in 2022 were $15,000. Record the write-off of accounts receivable in 2022. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)3-a. Assume the same facts as above but assume actual write-offs In 2022 were $15,000. Record the write-off of accounts recel3-b. Assume the same facts as above but assume actual write-offs in 2022 were $15,000. Calculate the balance of Allowance for Uncollectible Accounts at the end of 2022 (before adjustment in 2022).

Answer 1

Answer:

1. December 31, 2021

Dr Uncollectible amounts $12,500

Cr Allowance uncollectible amounts $12,500

2a. Dr Allowance uncollectible amounts $10,000

Cr Accoutns receivables $10,000

2b $2,500

Explanation:

1. Preparation to Record the adjusting entry for uncollectible accounts on December 31, 2021.

December 31, 2021

Dr Uncollectible amounts $12,500

Cr Allowance uncollectible amounts $12,500

[($60,000-$110,000)*25%]

(To record allowance)

2a. Preparation of the journal entry to Record the write-off of accounts receivable in 2022

Dr Allowance uncollectible amounts $10,000

Cr Accoutns receivables $10,000

(To Record the write-off of accounts receivable in 2022)

2b. Calculation to determine the balance of Allowance for Uncollectible Accounts at the end of 2022

Balance of the allowance accounts=[ 60,000-110,000)*25%] -$10,000

12,500 - 10,000 = 2,500

allowance uncollectible amounts 15,000 debit

accoutns receivables 15,000 credit

--to record write-off 2022--