Tanning Company analyzes its receivables to estimate bad debt expense. The accounts receivable balance is $300,000 and credit sales are $1,000,000. An aging of accounts receivable shows that approximately 5% of the outstanding receivables will be uncollectible. What adjusting entry will Tanning Company make if the Allowance for Doubtful Accounts has a credit balance of $2,000 before adjustment?
A]Bad Debt Expense 13,000
ADAccounts
13,000
B]Bad Debt Expense 15,000
ADAccounts 15,000
C]Bad Debt Expense 17,000
ADAccounts 17,000
D]Bad Debt Expense 20,000
ADAccounts 20,000
Paper Company receives a $6,000, 3-month, 6% promissory note from Dame Company in settlement of an open accounts receivable. What entry will Paper Company make upon receiving the note?
A]Notes Receivable 6,000
AReceivable—Dame Company 6,000
B]Notes Receivable 6,090
AReceivable—Dame Company 6,090
C]Notes Receivable 6,090
AReceivable—Dame Company 6,000
Interest Revenue 90
Notes Receivable 6,000
D]Interest Revenue 90
AR—Dame Company 6,000
Interest Receivable 90
Allowance for Doubtful Accounts has a credit balance of $800 at the end of the year [before adjustment], and an analysis of accounts in the customer ledger indicates the estimated amount of uncollectible accounts should be $16,000. Based on the estimate above, which of the following adjusting entries should be made?
A]debit Bad Debt Expense, $800; credit Allowance for Doubtful Accounts, $800
B]debit Bad Debt Expense, $15,200; credit Allowance for Doubtful Accounts, $15,200
C]debit Allowance for Doubtful Accounts, $800; credit Bad Debt Expense, $800
D]debit Bad Debt Expense, $16,800; credit Allowance for Doubtful Accounts, $16,800
Allowance for Doubtful Accounts has a debit balance of $1,100 at the end of the year [before adjustment], and an analysis of customers' accounts indicates uncollectible receivables of $12,900. Which of the following entries records the proper adjustment for Bad Debt Expense?
A]debit Bad Debt Expense, $14,000; credit Allowance for Doubtful Accounts, $14,000
B]debit Allowance for Doubtful Accounts, $14,000; credit Bad Debt Expense, $14,000
C]debit Allowance for Doubtful Accounts, $11,800; credit Bad Debt Expense, $11,800
D]debit Bad Debt Expense, $11,800; credit Allowance for Doubtful Accounts, $11,800
Abbott Company uses the allowance method of accounting for uncollectible accounts. Abbott estimates that 3% of net credit sales will be uncollectible. On January 1, 2010, the Allowance for Doubtful Accounts had a credit balance of $2,400. During 2010, Abbott wrote-off accounts receivable totaling $1,800 and made credit sales of $100,000. There were no Sales Returns or Sales Discounts during the year. After the adjusting entry, the December 31, 2010, balance in the Bad Debt Expense would be
$1,200
$3,000
$3,600
$7,200
Allowance for Doubtful Accounts has a debit balance of $800 at the end of the year [before adjustment], and an analysis of accounts in the customers ledger indicates uncollectible receivables of $15,000. Which of the following entries records the proper adjusting entry for bad debt expense?
A]debit Bad Debt Expense, $800; credit Allowance for Doubtful Accounts, $800
B]debit Bad Debt Expense, $14,200; credit Allowance for Doubtful Accounts, $14,200
C]debit Allowance for Doubtful Accounts, $800; credit Bad Debt Expense, $800
D]debit Bad Debt Expense, $15,800; credit Allowance for Doubtful Accounts, $15,800
Allowance for Doubtful Accounts has a credit balance of $1,500 at the end of the year [before adjustment], and an analysis of customers' accounts indicates uncollectible receivables of $17,900. Which of the following entries records the proper adjustment for Bad Debt Expense?
A]debit Allowance for Doubtful Accounts, $16,400; credit Bad Debt Expense, $16,400
B]debit Allowance for Doubtful Accounts, $19,400; credit Bad Debt Expense, $19,400
C]debit Bad Debt Expense $19,400; credit Allowance for Doubtful Accounts, $19,400
D]debit Bad Debt Expense, $16,400; credit Allowance for Doubtful Accounts, $16,400
Allowance for Doubtful Accounts has a credit balance of $1,400 at the end of the year [before adjustment]. The company prepares an analysis of customers' accounts to estimate the amount of uncollectible accounts of $17,900. Which of the following adjusting entries would be made to record the Bad Debt Expense for the year?
A]debit allowance for doubtful Accounts, $16,500; credit Bad Debt Expense, $16,500
B]debit Allowance for Doubtful Accounts $19,300; credit Bad Debt Expense, $19,300
C]debit Bad Debt Expense, $19,300; credit Allowance for Doubtful Accounts, $19,300
D]debit Bad Debt Expense, $16,500; credit allowance for Doubtful Accounts, $16,500
Allowance for Doubtful Accounts has a debit balance of $1,200 at the end of the year [before adjustment]. The company prepares an analysis of customers' accounts and estimates the amount of uncollectible accounts to be $13,900. Which of the following adjusting entries is needed to record the Bad Debt Expense for the year?
A]debit Bad Debt Expense, $15,100; credit Allowance for doubtful Accounts, $15,100
B]debit Allowance for Doubtful Accounts, $15,100; credit Bad Debt Expense, $15,100
C]debit Allowance for Doubtful Accounts, $12,700; credit Bad Debt Expense, $12,700
D]debit Bad Debt Expense, $12,700; credit Allowance for Doubtful Accounts, $12,700