Answer:
average cost is increasing
Explanation:
Answer:
A. $ 268,800
Explanation:
According to the net method,
A company will report the sales after deducting the discount (if there is any discount term is given) assuming that the buyer will pay the money within the discounting period.
Therefore, Old Oak Winery will report the sale as follows:
Sales revenue = $280,000
<u>Less: Sales discount ($280,000 × 4%) = $ 11,200 </u>
Net Sales revenue = $268,800
Hence, option A is correct.
Answer:
a. total estimated uncollectible accounts is $21,190
b. to entry the adjustment, we have to debit bad debt expense and credit allowance for doubtful accounts in the amount of $14,690
Explanation:
a. to compute the estimated uncollectible accounts, we have to multiply the specific % to the accounts receivable plus the beginning balance;
•Accounts not due
$36,000 x 4% = $1,440
•Accounts 1 - 60 days past due
$21,000 x 25% = $5,250
•Accounts more than 60 days past due
$16,000 x 50% = $8,000
So the total uncollectible accounts would be; $6,500 + $1,440 + $5,250 + $8,000 = $21,190
b. to record the year-end adjustment of the uncollectible accounts, we have to debit bad debt expense and credit allowance for doubtful accounts in the amount of $14,690. This figure is the uncollectible amount we computed earlier based on the aging.
