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Ksivusya [100]
3 years ago
13

Bramble Corp. uses the percentage of receivables method for recording bad debts expense. The accounts receivable balance is $220

000 and credit sales are $2210000. Management estimates that 5% of accounts receivable will be uncollectible. What adjusting entry will Bramble Corp. make if the Allowance for Doubtful Accounts has a credit balance of $4400 before adjustment
Business
1 answer:
hodyreva [135]3 years ago
4 0

Answer:

the adjusting entry:

Dr Bad debt expense 6,600

    Cr Allowance for doubtful accounts 6,600

Explanation:

accounts receivable balance = $220,000

total credit sales = $2,210,000

estimated uncollectible accounts = $220,000 x 5% = $11,000

allowance for doubtful accounts = $4,400 credit balance

bad debt expense = $11,000 - $4,400 = $6,600

Allowance for doubtful accounts is a contra asset account that reduces the carrying value of accounts receivable account, that is why its normal balance should be a credit balance.

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thomas owes $438 on his credit card and was unable to pay more than the minimum payment of $20. unfortunately he mailed the paym
Kazeer [188]

Answer:

$575.82.

Explanation:

Since Thomas owes $ 438 on his credit card, but only paid the minimum of $ 20, his debt is now $ 418 (438 - 20). A late fee of $ 39 will be added to this value, which will raise said sum to $ 457 (418 + 39). In turn, the interest rate for unpaid card balances is 26% per month. Therefore, next month his balance will be $ 575.82 (457 x 1.26).

7 0
2 years ago
Pam sees that the price of bananas has risen in the grocery store. All else equal, she decides to buy more tangerines than she n
Katyanochek1 [597]

Answer:

Option (c) is correct.

Explanation:

Given information states that bananas and tangerines are substitute goods. We know that the cross price elasticity of substitute goods is positive which means that there is a positive relationship between the price of one good and the quantity demanded for substitute good.

Therefore, in our case as the price of bananas increases and all the other factors remains constant then as a result the quantity demanded for tangerines increases.

3 0
3 years ago
Steamroller Company sells two products—J and B. Steamroller predicts that it will sell 7400 units of J and 6500 units of B in th
sp2606 [1]

Answer:

The weighted-average unit contribution margin is $4.50 per unit.

Explanation:

Weighted Average contribution margin is the average contribution margin of all products company sells.

Sale

Product J = 7,400

Product B = 6,500

Unit contribution margin

Product J = $2.9

Product B = $6.3

Contribution of Product J = 7,400 x $2.9 = $21,460

Contribution of Product B = 6,500 x $6.3 = $40,950

Total Contribution = $21,460 + 40,950 = $62,410

Total Sales Unit = 7,400 + 6,500 = 13,900 units

Weighted average contribution margin = Total Contribution / Total sales unit

Weighted average contribution margin = $62,410 / 13,900 units

Weighted average contribution margin = $4.49 per unit

Weighted average contribution margin = $4.5 per unit

3 0
3 years ago
What seems to be the prevailing opinion about enterprise clouds
aleksley [76]
It's used by almost everyone 
6 0
3 years ago
Wendell’s Donut Shoppe is investigating the purchase of a new $40,000 donut-making machine. The new machine would permit the com
oksano4ka [1.4K]

Answer:

initial outlay $40,000

savings per year = $5,200

additional contribution margin = 2,000 x $2.40 = $4,800

machines useful life = 6 years

1) total annual cash flows (assuming no residual value)

Year₀ = -$40,000

Year₁ = $5,200 + $4,800 = $10,000

Year₂ = $10,000

Year₃ = $10,000

Year₄ = $10,000

Year₅ = $10,000

Year₆ = $10,000

2) to determine IRR we can use a financial calculator or the present value of an annuity formula:

PV = annual payment x annuity factor

PV = $40,000

annual payment = $10,000

annuity factor = $40,000 / $10,000 = 4

3) using present value of an annuity table:

we have 6 periods, and we must look for an interest rate that results in an annuity factor of 4 = 13% (the exact annuity factor is 3.998)

using a financial calculator, the IRR = 12.98%, which we can round to 13%

4) the cash flows will be:

Year₀ = -$40,000

Year₁ = $10,000

Year₂ = $10,000

Year₃ = $10,000

Year₄ = $10,000

Year₅ = $10,000

Year₆ = $20,515

We cannot use the annuity formula now because our annuities are not equal. Using a financial calculator, IRR = 16.99%

6 0
3 years ago
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