User Account

All Pages

What type of account is allowance for doubtful accounts

Assignment Help Accounting Basics
Reference no: EM131144320

At December 31, 2010, the trial balance of Worcester Company contained the following amounts before adjustment.

Instructions

(a) Based on the information given, which method of accounting for bad debts is Worcester Company using-the direct write-off method or the allowance method? How can you tell?

(b) Prepare the adjusting entry at December 31, 2010, for bad debts expense under each of the following independent assumptions.

(1) An aging schedule indicates that $11,750 of accounts receivable will be uncollectible.

(2) The company estimates that 1% of sales will be uncollectible.

(c) Repeat part (b) assuming that instead of a credit balance there is an $2,000 debit balance in Allowance for Doubtful Accounts.

(d) During the next month, January 2011, a $3,000 account receivable is written off as uncollectible. Prepare the journal entry to record the write-off.

(e) Repeat part (d) assuming that Worcester uses the direct write-off method instead of the allowance method in accounting for uncollectible accounts receivable.

(f) What type of account is Allowance for Doubtful Accounts? How does it affect how accounts receivable is reported on the balance sheet at the end of the accounting period?

Reference no: EM131144320

Questions Cloud

Provide a linear programming model formulation only : Each day, at most 20,000 barrels of oil can be purchased and 8 hours of cracker time are available. Sunco would like to maximize their profits. Provide a linear programming model formulation only; you do not need to identify an optimal solution.
Interest is computed using a 360 day year : Interest is computed using a 360-day year. During October, the following transactions were completed.
Provide a linear programming model formulation and solve : The profit contributions are $40 per 1000 board feet of lumber products and $60 per 1000 square feet of plywood. The company is interested in maximizing profits. Provide a linear programming model formulation and solve for an optimal solution.
Which of the following items affect free cash flows to debt : Which of the following items affect free cash flows to debt and equity holders? Which affect free cash flows to equity alone? Explain why and how.
What type of account is allowance for doubtful accounts : What type of account is Allowance for Doubtful Accounts? How does it affect how accounts receivable is reported on the balance sheet at the end of the accounting period?
Would this condition be satisfied if the number of waiting : The vice president of a bank wishes to provide banking services so that the probability of the number of waiting customers being greater than 8 is less than .07. Would this condition be satisfied if the number of waiting customers is a Poisson random..
Calculate the total estimated bad debts based : Calculate the total estimated bad debts based on the above information.
What is the probability that at least 30 employees out of 80 : What is the probability that at least 30 employees out of 80 would be financially secure if they lost their job for 6 months to a year? Do a 'what-if' analysis by changing the probability to .4, and .5, and rework part a).
What is the probability that the random variable is less : a) What is the probability that the random variable is less than 23? b) What is the mean of the random variable? c) What is the standard deviation of the random variable?

Reviews

Write a Review

Accounting Basics Questions & Answers

  What amount of deferred tax liability should be reported

Oxford's tax rate for 2010 and years thereafter is 30%. In its December 31, 2010 balance sheet, what amount of deferred tax liability should be reported?

  What is the campany''s revenue recongnition policy?

What is the campany's revenue recongnition policy?

  What is the role of a crm system

What is the role of a CRM system? What sort of benefits can such a system produce for a business?

  Prepare a comparative income statement for fiscal years

Prepare a comparative income statement for fiscal years 2005 and 2006 in vertical form, stating each item as a percent of revenues. Round to one decimal place.

  Is accounting an art or a science

Is accounting an Art or a Science - Response. After reviewing the question, I figured that accounting to be considered a science, since it deals with equations, numbers, etc. just like mathematics.

  Relevance versus faithful representation

1. Relevance versus Faithful Representation. The fair value of the build- ing may provide more relevant information to decision makers, but fair value estimates are not as free from error as historical cost information.

  Classification of acquisition costs selected accounts

Expenditures totaling $95,000 were made for new parking lots, streets, and sidewalks at the corporation's various plant locations. These expenditures had an estimated useful life of 15 years.

  Cardinals corporation had a 1114 balance in the allowance

cardinals corporation had a 1114 balance in the allowance for doubtful accounts of 20000. during 2014 it wrote off

  He purchased equipment in january costing 1500 replacement

frank fronton decided to become a professional jai alai player. in january fronton joined a jai alai club where he

  Larry monroe owns an apartment building in chicago because

larry monroe owns an apartment building in chicago . because of his age larry is thinking of leaving those chicago

  A client operates a small business organized as a sole

a client operates a small business organized as a sole propreintship and is considering change the business to operate

  Write a thorough discussion of the following capital

write a thorough discussion of the following capital expenditure valuation methods payback discounted payback net

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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