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150. On December 31, 2015, Central Freight reported an allowance for

Question : 150. On December 31, 2015, Central Freight reported an allowance for : 1412696

 

 

150.

On December 31, 2015, Central Freight reported an allowance for uncollectible accounts of $15,300. During 2016, Central wrote off $17,000 in accounts receivable. Included in the write-off was Roskoff Corp.'s account in the amount of $750. Roskoff subsequently paid this balance. At December 31, 2016, an analysis of the accounts receivable aging schedule indicated the need for an allowance for uncollectible accounts of $14,900.

Required:

Prepare all implied journal entries relative to bad debt expense and the allowance for uncollectible accounts. 
 
 

 

 

 

 

 

151.

Cordova Inc., reported the following receivables in its December 31, 2015, year-end balance sheet:

 

Accounts receivable, net of $52,000 in allowance for  uncollectible accounts

$384,000

Interest receivable

19,000

Notes receivable

400,000



Additional information:

1. The notes receivable account consists of two notes, a $100,000 note and a $300,000 note. The $100,000 note is dated October 31, 2015, with principal and interest payable on October 31, 2016. The $300,000 note is dated March 31, 2015, with principal and 8% interest payable on March 31, 2016.
2. During 2016, sales revenue totaled $2,120,000, $1,980,000 cash was collected from customers, and $41,000 in accounts receivable were written off. All sales are made on a credit basis. Bad debt expense is recorded at year-end by adjusting the allowance account to an amount equal to 8% of year-end accounts receivable.

Required:

1. In addition to sales revenue, what revenue and expense amounts related to receivables will appear in Cordova's 2016 income statement?
2. Calculate the receivables turnover ratio for 2016.


 
 

 

1. In addition to sales revenue of $2,120,000, the 2016 income statement will also include interest revenue and bad debt expense.

 

 

 

 

 

Solution
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