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    The ledger of Elburn Company

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    E9-2 The ledger of Elburn Company at the end of the current year shows Accounts Receivable
    $110,000, Sales $840,000, and Sales Returns and Allowances $28,000.
    Instructions
    (a) If Elburn uses the direct write-off method to account for uncollectible accounts, journalize
    the adjusting entry at December 31, assuming Elburn determines that Copp's $1,400 balance
    is uncollectible.
    (b) If Allowance for Doubtful Accounts has a credit balance of $2,100 in the trial balance, journalize
    the adjusting entry at December 31, assuming bad debts are expected to be (1) 1%
    of net sales, and (2) 10% of accounts receivable.
    (c) If Allowance for Doubtful Accounts has a debit balance of $200 in the trial balance, journalize
    the adjusting entry at December 31, assuming bad debts are expected to be (1) 0.75%
    of net sales and (2) 6% of accounts receivable.

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    Solution Preview

    E9-2 The ledger of Elburn Company at the end of the current year shows Accounts Receivable $110,000, Sales $840,000, and Sales Returns and Allowances $28,000.

    a) If Elburn uses the direct write-off method to account for uncollectible accounts, journalize the adjusting entry at December 31, assuming Elburn determines that Copp's $1,400 balance is uncollectible.
    b) If Allowance for Doubtful Accounts has a credit balance of $2,100 in the trial balance, ...

    Solution Summary

    This solution is comprised of a detailed explanation to journalize the adjusting entry at December 31 for Elburn Company.

    $2.19

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