Chat with AI
Financial & Managerial Accounting 3rd Edition by Charles Horngren,Harrison, Walter,Suzanne Oliver
Edition 3ISBN: 978-0132962339Financial & Managerial Accounting 3rd Edition by Charles Horngren,Harrison, Walter,Suzanne Oliver
Edition 3ISBN: 978-0132962339 Exercise 33
Applying the allowance method (percentage of sales) to account for uncollectibles
During its first year of operations, Spring Garden Plans earned revenue of $322,000 on account. Industry experience suggests that bad debts will amount to 2% of revenues. At December 31, 2012, accounts receivable total $36,000. The company uses the allowance method to account for uncollectibles.
Requirements
1. Journalize Spring's sales and uncollectible account expense using the percent-of-sales method.
2. Show how to report accounts receivable on the balance sheet at December 31, 2012. Use the long reporting format illustrated in the chapter.
During its first year of operations, Spring Garden Plans earned revenue of $322,000 on account. Industry experience suggests that bad debts will amount to 2% of revenues. At December 31, 2012, accounts receivable total $36,000. The company uses the allowance method to account for uncollectibles.
Requirements
1. Journalize Spring's sales and uncollectible account expense using the percent-of-sales method.
2. Show how to report accounts receivable on the balance sheet at December 31, 2012. Use the long reporting format illustrated in the chapter.
Explanation
Verified
Verified
This exercise requires application of th...
Financial & Managerial Accounting 3rd Edition by Charles Horngren,Harrison, Walter,Suzanne Oliver
Why don’t you like this exercise?
Other Minimum 8 character and maximum 255 character
Character 255
