Explore BrainMass

Explore BrainMass

    Doubtful Debts for the Elburn Company

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Need help with solution.
    Journalize entries to record allowance for doubtful accounts. Please use attached Excel and follow the instructions.

    Exercise E9-2 Journalize entries to record allowance for doubtful accounts using to different bases.
    The ledger of Elburn Company at the end of the current year shows:
    Accounts Receivable $110,000
    Sales 840,000
    Sales Returns and Allowances 28,000

    Instructions: Please replace the Account titles with your choice of the Account name
    Also, replace the Text explanation with your choice of an Explanation for the Entry
    (a) If Elburn uses the direct write-off method to account for uncollectible accounts, journalize the
    adjusting entry at December 31st, assuming Elburn determines that Coop's $1,400 balance is uncollectible.

    Dec 31 Account title Value
    Account title
    Text explanation

    (b) (1) If Allowance for Doubtful Accounts has a credit balance of $2,100 in the trial balance, journalize the
    adjusting entry at December 31st, assuming bad debts are expected to be 1% of net sales.

    Dec 31 Account title Value
    Account title
    Text explanation

    (b) (2) If Allowance for Doubtful Accounts has a credit balance of $2,100 in the trial balance, journalize the
    adjusting entry at December 31st, assuming bad debts are expected to be 10% of accounts receivable.

    Dec 31 Account title Value
    Account title
    Text explanation

    (c) (1) If Allowance for Doubtful Accounts has a debit balance of $200 in the trial balance, journalize the
    adjusting entry at December 31st, assuming bad debts are expected to be 0.75% of net sales

    Dec 31 Account title Value
    Account title
    Text explanation

    (c) (2) If Allowance for Doubtful Accounts has a debit balance of $200 in the trial balance, journalize the
    adjusting entry at December 31st, assuming bad debts are expected to be 6% of accounts receivable.

    Dec 31 Account title Value
    Account title
    Text explanation

    © BrainMass Inc. brainmass.com June 3, 2020, 8:42 pm ad1c9bdddf
    https://brainmass.com/business/auditing/doubtful-debts-elburn-company-149375

    Attachments

    Solution Summary

    The solution explains various journal entries relating to doubtful accounts.

    $2.19

    ADVERTISEMENT