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21) The following information from the 2015 records of Armand

Question : 21) The following information from the 2015 records of Armand : 1412211

 

21) The following information is from the 2015 records of Armand Camera Shop:

 

Accounts Receivable, December 31, 2015

$40,000 (debit)

Allowance for Bad Debts, December 31, 2015

prior to adjustment

1,500 (debit)

Net credit sales for 2015

175,000

Accounts written off as uncollectible during 2015

15,000

Cash sales during 2015

27,000

 

Bad debts expense is estimated by the percent-of-sales method. The management estimates that 3% of net credit sales will be uncollectible. Calculate the amount of bad debts expense for 2015.

A) $5,250

B) $3,450

C) $2,250

D) $2,850

22) The following information is from the 2015 records of Armand Camera Shop:

 

Accounts Receivable, December 31, 2015

$40,000 (debit)

Allowance for Bad Debts, December 31, 2015

prior to adjustment

1,500 (debit)

Net credit sales for 2015

175,000

Accounts written off as uncollectible during 2015

15,000

Cash sales during 2015

27,000

 

Bad debts expense is estimated by the aging-of-receivables method. Management estimates that $5,000 of accounts receivable will be uncollectible. Calculate the amount of bad debts expense for 2015.

A) $7,000

B) $6,500

C) $6,450

D) $5,250

23) The following information is from the 2015 records of Armand Camera Shop:

 

Accounts Receivable, December 31, 2015

$40,000 (debit)

Allowance for Bad Debts, December 31, 2015

prior to adjustment

1,500 (debit)

Net credit sales for 2015

175,000

Accounts written off as uncollectible during 2015

15,000

Cash sales during 2015

27,000

 

Bad debts expense is estimated by the percent-of-sales method. Management estimates that 3% of net credit sales will be uncollectible. The balance of the Allowance for Bad Debts account after adjustment will be ________.

A) $7,000

B) $3,450

C) $2,850

D) $3,750

24) The following information is from the 2015 records of Armand Camera Shop:

 

Accounts Receivable, December 31, 2015

$40,000 (debit)

Allowance for Bad Debts, December 31, 2015

prior to adjustment

1,500 (debit)

Net credit sales for 2015

175,000

Accounts written off as uncollectible during 2015

15,000

Cash sales during 2015

27,000

 

Bad debts expense is estimated by the aging-of-receivables method. Management estimates that $5,000 of accounts receivable will be uncollectible. Calculate the Allowance for Bad Debts after the adjustment for bad debt expense at December 31, 2015.

A) $5,250

B) $6,500

C) $7,000

D) $5,000

 

25) Smart Art is a new establishment. During the first year, there were credit sales of $40,000 and collections of credit sales of $36,000. One account for $650 was written off. The company decided to use the percent-of-sales method to account for bad debts expense, and decided to use a factor of 2% for its year-end adjustment of bad debts expense. What is the ending balance in Accounts Receivable at the end of the year?

A) $4,000

B) $3,600

C) $3,350

D) $3,200

26) Smart Art is a new establishment. During the first year, there were credit sales of $40,000 and collections of credit sales of $36,000. One account for $650 was written off. The company decided to use the percent-of-sales method to account for bad debts expense, and decided to use a factor of 2% for their year-end adjustment of bad debts expense. The ending balance in Allowance for Bad Debts account would be ________.

A) $150

B) $800

C) $250

D) $1,450

 

27) Smart Art is a new establishment. During the first year, there were credit sales of $40,000 and collections of credit sales of $36,000. One account for $650 was written off. The company decided to use the percent-of-sales method to account for bad debts expense, and decided to use a factor of 2% for their year-end adjustment of bad debts expense. At the end of the year, the balance of bad debts expense would be ________.

A) $150

B) $800

C) $250

D) $1,450

 

28) Smart Art is a new establishment. During the first year, there were credit sales of $40,000 and collections of credit sales of $36,000. One account for $650 was written off. The company decided to use the aging-of-receivables method to account for bad debts expense, and estimated $500 as uncollectible at year end. Therefore, the ending balance in the Allowance for Bad Debts would be ________.

A) $150

B) $800

C) $200

D) $500

29) A newly created design business called Smart Art is just finishing up its first year of operations. During the year, there were credit sales of $40,000 and collections of credit sales of $36,000. One account for $650 was written off. Smart Art uses the aging method to account for uncollectible account expense. It has estimated $200 as uncollectible at year-end. At the end of the year, what is the ending balance in the Bad Debts Expense account?

A) $1,150

B) $800

C) $200

D) $850

 

30) At the beginning of 2015, Elixir Inc. has the following ledger balances:

 

 

During the year, credit sales amounted to $800,000. Cash collected on credit sales amounted to $760,000, and $18,000 has been written off. At the end of the year, the company adjusted for bad debts expense using the percent-of-sales method and applied a rate, based on past history, of 2.5%. The ending balance of Accounts Receivable would be ________.

A) $40,000

B) $62,000

C) $80,000

D) $18,000

 

 

 

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