At December 31, 2017, Hawke Company reports the following results for its calendar year. Cash sales $ 1,436,130 Credit sales 3,101,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable $ 939,603 debit Allowance for doubtful accounts 21,540 debit
Required: 1. Prepare the adjusting entry for this company to recognize bad debts under each of the following independent assumptions. Bad debts are estimated to be 4% of credit sales. Bad debts are estimated to be 3% of total sales. An aging analysis estimates that 7% of year-end accounts receivable are uncollectible.
At December 31, 2017, Hawke Company reports the following results for its calendar year. Cash sales $ 1,436,130 Credit sales 3,101,000 In addition, its unadjusted trial balance includes the following items. Accounts receivable $ 939,603 debit Allowance for doubtful accounts 21,540 debit
Required: 1. Prepare the adjusting entry for this company to recognize bad debts under each of the following independent assumptions. Bad debts are estimated to be 4% of credit sales. Bad debts are estimated to be 3% of total sales. An aging analysis estimates that 7% of year-end accounts receivable are uncollectible.
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Problem 9-2A Estimating and reporting bad debts LO P2, P3
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At December 31, 2017, Hawke Company reports the following results for its calendar year.
| Cash sales | $ | 1,305,010 | |
| Credit sales | 3,261,000 | ||
In addition, its unadjusted trial balance includes the following items.
| Accounts receivable | $ | 988,083 | debit |
| Allowance for doubtful accounts | 16,930 | debit | |
Problem 9-2A Part 1
Required:
1. Prepare the adjusting entry for this company to recognize bad debts under each of the following independent assumptions.
a. Bad debts are estimated to be 2% of credit sales.
b. Bad debts are estimated to be 1% of total sales.
c. An aging analysis estimates that 5% of year-end accounts receivable are uncollectible.
Adjusting entries (all dated December 31, 2017).
Problem 9-2A Part 2
2. Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December 31, 2017, balance sheet given the facts in part 1a.
Problem 9-2A Part 3
3. Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December 31, 2017, balance sheet given the facts in part 1c.
| At December 31, 2013, HawkeCompany reports the following results for its calendar year. |
| Cash sales | $ | 1,905,000 |
| Credit sales | 5,682,000 | |
| In addition, its unadjustedtrial balance includes the following items. |
| Accountsreceivable | $ | 1,270,100 | debit |
| Allowance fordoubtful accounts | 16,580 | debit |
| Required: | |
| 1. | Prepare the adjusting entry for this company to recognize baddebts under each of the following independent assumptions. |
| a. | Bad debts are estimated to be1.5% of credit sales. |
| b. | Bad debts are estimated to be 1%of total sales. |
| c. | An aging analysis estimates that5% of year-end accounts receivable are uncollectible. |
Adjusting entries (all datedDecember 31, 2013).
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