Estimating uncollectible accounts percentage

Assignment Help Accounting Basics
Reference no: EM13153957

At the end of 2009 Martel Co.'s had $410,000.00 in Account Receivable and a credit balance of $3,00 in Allowance for Bad Debts. Martel has now been in business for three years and wants to base its estimate of uncollectible accounts on its own experience.

Require

Assume that Martel Co.'s adjusting entry for bad debts expense on December 31 2009 was a debit to bad debt expense and a credit to Allowance for bad debts of $25,000.00

A) Estimate Martel's uncollectible accounts percentage based on its actual bad debts experience during the past two years.

B) Prepare the adjusting entry on December 31, 2009 for Martel Co.'s bad debt expenses.

Reference no: EM13153957

Questions Cloud

Balance sheet of a manufacturing company : Which one of the following does not appear on the balance sheet of a manufacturing company?
Is there a difference in variances of the decision rule : The means appear to be very close, but not the variances. (a) At α = .05, is there a difference in variances? (b) Show all steps clearly, including an illustration of the decision rule.
How many milliliters of 0.200 m naoh are needed : How many milliliters of 0.200 M NaOH are needed to neutralize 100. mL of 0.100 M HCl
What conditions will the smaller-higher-cost growers : Under what conditions (such as relative costs, position of the demand curve, number of low-cost firms) will the smaller, higher-cost growers be driven out of business?
Estimating uncollectible accounts percentage : Estimate Martel's uncollectible accounts percentage based on its actual bad debts experience during the past two years. Prepare the adjusting entry on December 31, 2009 for Martel Co.'s bad debt expenses.
Financial statements for the organization : The chief executive officer of your organization has asked you to compare the organization you are thinking of acquiring with a competitor. Obtain financial statements for the organization under investigation and its competitor, and perform the fo..
Which is the better investment based on risk aversion andwhy : Security A will yield a 6% return in one year. Security B will either yield a 3% return or a 9% return in one year with equal probability. Which is the better investment based on risk aversion and why?
What strategy will each player choose : What is player 2's maximin strategy? If the game were played with Player 1 moving first and player 2 moving second, using the backward induction method, what strategy will each player choose?
How monetary policy affects aggregate supply : How monetary policy affects aggregate supply and demand and inflation, explain exactly how a change in the federal funds rate can trigger all these reactions. Use at least 4 graphs. Do you think we are in a liquidity trap today? Why or why not?

Reviews

Write a Review

 

Accounting Basics Questions & Answers

  Sales and recognition of cost of merchandise sold

On March 5th, Blowout Sales makes $22,500.00 in sales on the company's own credit cards. The cost of merchandise sold are $16,825.00. Journalize the sales and recognition of the cost of merchandise sold.

  Amount of the lease receivable of wadkins company

Wadkins Company, a machinery dealer, leased a machine to Romero Corporation on January 1, 2011. Compute the amount of the lease receivable.

  Management efficiency are ratios financial ratios

Receivables Turnover Ratio - The receivables turnover ratio tells us how many times accounts receivable have been collected in a given accounting period. Receivables turnover is calculated by taking the last 12 months of sales and dividing by the ..

  How many ticket packages will george need to sell

George plans to sell his customers a special for a ski package weekend. He is able to purchase the package from the providers for $175 each. The ticket packages will be sold for $225 each and the ski resort and lodging facilities intend to reimbur..

  Compute warrens actual return on plan assets

For Warren Corporation, year-end plan assets were $2,000,000. At the beginning of the year assets were $1,780,000. During the year, contributions to the pension fund were $120,000, and benefits paid were $200,000. Compute Warren's actual return on..

  Cost of inspection and budgeted amount

Inspection hours for the 10,000 tables varnished in September totaled 2,500 hours by 16 employees. Eight quarts of varnish were used, on average, for each table. The standard amount of varnish per table is nine quarts. The cost of inspection for S..

  Determining disposal of machine

A company purchased and installed a machine on January 1, 2004 at a total cost of $72,000. Straight-line depreciation was calculated based on the assumption of a five-year life and no salvage value. The machine was disposed of on July 1, 2007.

  Correct piece of the journal entry

At the time of issuance, the market interest rate for similar financial instruments is 10%. Which of the following is a correct piece of the journal entry on September 1, 2010?

  Determine the direct labor efficiency variance

Explorer, Inc., manufactures lanterns for camping. The company's direct labor rates have been set by the terms of the current labor contract. Direct labor rate standards have been assigned for each job classification.

  Capitalized lease liability

The rounded present value of an ordinary annuity for nine years at 9% is 6.0. What amount should N report as capitalized lease liability at December 31, 2009?

  Important characteristics of generally accepted accounting

Explain the important characteristics of Generally Accepted Accounting Principles or standards. Why are these characteristics of GAAP important?

  Bad debt expense balance on the income statement

The current credit balance in allowance for uncollectible accounts is $200. Management estimates that 2.5% of net credit sales of $115,000 will be uncollectible. Based on the foregoing data, what is the bad debt expense balance on the income state..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd