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andre [41]
2 years ago
12

Assume that Simple Co. had credit sales of $280,000 and cost of goods sold of $165,000 for the period. It estimates that 2 perce

nt of credit sales in uncollectible accounts when it uses the percentage of credit sales method and it estimates that the appropriate ending balance in the Allowance for Doubtful Accounts is $6,900 when it uses the aging method. Before the end-of-period adjustment is made, the Allowance for Doubtful Accounts has a credit balance of $400.
Required:
Prepare the journal entry to record the end-of-period adjustment for bad debts under the (a) percentage of credit sales method and (b) aging of accounts receivable method.
Business
1 answer:
elena-s [515]2 years ago
7 0

Answer:

A. Dr Bad Debt Expense $5,600

Cr Allowance for Doubtful Accounts $5,600

B. Dr Bad Debt Expense $6,500

Cr Allowance for Doubtful Accounts $6,500

Explanation:

A. Preparation of the journal entry to record the end-of-period adjustment for bad debts under

percentage of credit sales method

Dr Bad Debt Expense $5,600

Cr Allowance for Doubtful Accounts $5,600

($280,000 x .02 = 5600)

(Being to record bad debts under percentage of credit sales method)

B. Preparation of the journal entry to record the end-of-period adjustment for bad debts under the aging of accounts receivable method.

Dr Bad Debt Expense $6,500

Cr Allowance for Doubtful Accounts $6,500

($6,900 - $400 = 6500)

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If he wanted the cash award of each of the five prizes to be $45,000 and his estate could earn 7% per year, how much would he ne
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Answer:

The answer is $3,214,285.71

Explanation:

Price of each award is $45,000

And there are 5

Therefore, we have 5 x $45,000

=$225,000.

So, $225,000 is the future value.

Rate of return(r) in 7% and it is being assumed that it is forever.

So, so how much will be needed to fund his prizes(present value)?:

PV = FV/r

= $225,000/0.07

=$3,214,285.71

5 0
3 years ago
A promising new customer at a FINRA member firm has complained verbally to a registered representative that he lost $500 on the
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Answer:

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4 0
3 years ago
Valvano Corporation uses a job-order costing system with a single, plantwide, predetermined overhead rate based on machine-hours
alukav5142 [94]

Answer:

The estimated total manufacturing overhead is closest to $550,000

Explanation:

Total manufacturing overhead = variable + fixed overhead absorbed

Fixed overhead absorbed = Overhead absorption rate × machine hour

Overhead absorption rate = Estimated overhead/Estimated machine hours

                               = $440,000/50,000 machine hours

                              = 8.8  per machine hour

Absorbed fixed overhead = $8.8 × 50,000= $440,000

Absorbed variable overhead= $2.20  × 50,000= $110000

Total manufacturing overhead = $440,000+ 110000 =$550,000

The estimated total manufacturing overhead is closest to $550,000

3 0
3 years ago
Which of the following is an advantage of internal recruitment? a. It leads to the generation of new ideas through tunnel vision
Georgia [21]

"It improves organization fit because current employees understand the company's culture" is an advantage of internal recruitment.

<u>Option: C</u>

<u>Explanation:</u>

Recruitment are of basically two types on the basis of staff location like internal and external. Each firm is more comfortable to recruit departmental candidate because the current staff is well aware about the firm atmosphere.

This helps to save time of training to them, better fluency in work, trust factors, etc. Although external recruitment is also need to invite fresh talent with more energy and enthusiasm towards work profile, thus to train them and bring on specific track, training and meetings are needed to held.

4 0
3 years ago
In its first month of operations, Culver Company made three purchases of merchandise in the following sequence: (1) 205 units at
Oksi-84 [34.3K]

Answer:

$2,450 ; $1,430

Explanation:

The computation of the ending inventory using the periodic inventory system is shown below:

Under FIFO method

= 245 units × $10

= $2,450

We take the last units in this FIFO method

Under the LIFO method

= 205 units × $6 + 40 units × $5

= $1,230 + $200

= $1,430

We take the first units in this LIFO method

Hence, the closing inventory is come

3 0
3 years ago
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