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3 years ago

Discount Mart utilizes the allowance method of accounting for uncollectible receivables.

Business

1 answer:

lara [203]3 years ago

6 0

Answer: See explanation

Explanation:

From the question, we are given the information that on December 12, the company receives a $540 check from Chad Thomas in settlement of Thomas's $1,280 outstanding accounts receivable, then the journal entry based on the above will be:

December 12:

Debit Cash $540

Debit Allowance for doubtful account $740

Credit Account receivable $1280

Note that the allowance for doubtful account was calculated as:

= Account receivable - Cash

= $1280 - $540

= $740

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ABC Grocers uses a separate checking account to pay their employees. The gross pay for the period was $850. However, after deduc

choli [55]

Answer:

Debit Payroll expense $850

Credit Cash/Bank Account $790

Credit Deduction (liability) $60

Being entries to record payroll expense

Explanation:

Given;

Gross pay for the period = $850

After deductions were taken out, the net pay for the period = $790

Therefore, amount deducted = $850 - $790

= $60

The journal to record this would include;

Debit Payroll expense $850

Credit Cash/Bank Account $790

Credit Deduction (liability) $60

Being entries to record payroll expense

On remittance of the deduction to the appropriate party

Debit Deduction (liability) $60

Credit Cash/Bank Account $60

4 0

4 years ago

The comparative balance sheets for Montalvo Company show these changes in noncash current asset accounts: accounts receivable de

fomenos

Answer:

The $286,900 is the net cash which is provided by the operating activities using the indirect method.

Explanation:

The computation of net cash provided by operating activities using the indirect method is shown below:

= Net income - decrease in accounts receivables - increase in prepaid expenses - increase in inventories

= $268,900 + $80,000 - $28,500 - $33,500

= $286,900

The decrease in accounts receivable impact the cash balance in a positive manner. So, it is added whereas, the increase in prepaid expenses and the increase in inventories have a negative impact on cash balance that's why it is deducted.

These transactions have an inflow and outflow of cash. That's why the adjustment is done accordingly

Hence, the $286,900 is the net cash which is provided by the operating activities using the indirect method.

7 0

3 years ago

An area surrounding the incident in which persons may be exposed to dangerous and life-threatening concentrations of material is

Marat540 [252]

This is called the initial isolation zone which is a circular zone with a radius equal to the initial isolation distance within which persons may be unprotected to dangerous concentrations upwind of the source and may be unprotected to life threatening concentrations downwind of the source. Regulating distances for a detailed incident involves many inter-reliant variables and should be made only by personnel technically qualified to make such adjustments.

5 0

3 years ago

A Company accumulates the following data concerning raw materials in making one gallon of finished product: (1) Price-net purcha

nordsb [41]

Answer:

Hence,

1. $2.5

2. 3 pounds

3. $7.5

Explanation:

1. The computation of standard direct material price per gallon is shown below:

=Price-net purchase price + freight-in + receiving and handling

= $2.20 + $0.20 +$0.10

= $2.5

Thus, the standard direct material price per gallon is $2.5

2. The computation of standard direct material quantity per gallon is shown below:

= Quantity required material + Allowance for waste and spoilage

= 2.6 +0.4

= 3 pounds

3. The computation of total standard material cost per gallon is computed below:

= Standard direct materials price per gallon × Standard direct materials quantity per gallon

= $2.5 × 3

= $7.50

Hence,

1. $2.5

2. 3 pounds

3. $7.5

8 0

3 years ago

Lance Brothers Enterprises acquired $710,000 of 4% bonds, dated July 1, on July 1, 2021, as a long-term investment. Management h

babunello [35]

Answer:

The question is missing the below requirement:

Prepare the journal entries (a) to record Lance Brothers’ investment in the bonds on July 1, 2021, and (b) to record interest on December 31, 2021, at the effective (market) rate:

The journal entries upon acquisition of the bond is shown thus:

DR Financial asset $710000

CR Discount on financial asset $80000

CR Cash $630000

The journal entry to record the interest on 31 December 2021 is as follows:

The interest is calculated on the par value value;

Cash $710000*4%*6/12 $14200

Discount on bond $1550

Interest revenue $630000*5%*6/12 $15750

Explanation:

The investment is recorded at the par value in financial asset account but the cash paid is lower,which means the issuer issued the bond at discount ,hence the discount of $80000 is recorded.

Also the discount is considered when the interest was calculated as the effective interest is lower than the coupon,which means the discount gotten earlier was partial interest received in advance.

6 0

4 years ago