What is the process of analyzing accounts receivable and classifying by how old the due dates are?

1. What is the process of analyzing accounts receivable and classifying by how old the due dates are?
2. What is the name of the expense used to track receivable accounts estimated to be uncollectible?
3. Name one method used to estimate Bad Debts.
4. Name another method used to estimate Bad Debts.
5. Name the receivable created when customers are issued a formal, written document including specific terms of payment.
6. In what section on the Balance Sheet would Accounts Receivable be located?
7. What kind of account is Allowance for Doubtful Accounts?
8. Accounts Receivable should be collected in about how many days?
9. What is the name of the expense used to record the usage of fixed assets?
10. What is the name of the expense used to record the periodic write off of the cost of intangible assets?
11. What is the name of the expense used to record the utilization of natural resources?
12. Name the most popular depreciation method used by businesses today.
13. What kind of account is Accumulated Depreciation?
14. Is Land depreciated, yes or no?
15. Name one of the payroll taxes paid by employers.
16. Name another one of the payroll taxes paid by employers.
17. Name yet another one of the payroll taxes paid by employers.
18. What kind of account is Interest Payable?
19. Gross Wages LESS Deductions EQUAL what?
20. Do employees have contributions deducted from their paychecks for federal and state unemployment, yes or no?

KEY INFORMATION: On 3/5/07, our company, ABC Textbooks, Inc., borrows $150,000 from the First Bank & Trust. The terms of the note are 90-days at 8%.

21. What is the maturity date of the note?
22. – 23. What is the amount of total interest on this note?
24. – 25. What is the maturity value of the note?

#2: Record journal entries in the general journal below for Jax-Mart. Sample accounts include: Accounts Receivable, Allowance for Doubtful Accounts, Sales, Cash, Uncollectible Accounts Expense, and Notes Receivable. DO NOT ABBREVIATE.

1/2/07 Using the analysis of receivables method, write off Mr. Jones account of $585. His bankruptcy settlement was just completed. (3 points)

11/25/07 Mr. Jones paid his $585 balance in full. Record the journal entry to reinstate his account, and then record the cash receipt. (2 entries required)

12/31/07 Using the analysis of receivables method, record the provision for estimated uncollectible accounts at the end of the year at 10% with receivables of $175,000. Note that the balance in Allowance for Doubtful Accounts has a credit balance of $2000 before this journal entry.

12/31/07 - Now trying using a different method. Using the percent of sales method, record the provision for estimated uncollectible accounts at the end of the year, at 1% with sales of $1,500,000

#3: Instructions: Compute depreciation expense for two years using 3 different methods using the following information. Show all work for maximum points!!!:
• Machinery was acquired on the first day of the current year for $420,000
• The estimated useful life is 5 years or 40,000 hours
• The residual value is estimated at $20,000
• During year one, the machinery was used for 11,500 hours
• During year two, the machinery was used for 17,000 hours

METHOD YEAR ONE YEAR TWO

Straight Line (3 points)

Units of Production (6 points)

Double Declining Balance (6 points)

Click here for the solution: What is the process of analyzing accounts receivable and classifying by how old the due dates are?

The ledger of Hixson Company at the end of the current year shows accounts receivable 120,000, sales 840,000 and sales returns and allowance 30,000

E8-3 The ledger of Hixson Company at the end of the current year shows accounts receivable 120,000, sales 840,000 and sales returns and allowance 30,000.

Instructions
a) If Hixson uses the direct write off method to account for uncollectible accounts, journalize the adjusting entry at December 31, assuming Hixson determines that fells 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.

Click here for the solution: The ledger of Hixson Company at the end of the current year shows accounts receivable 120,000, sales 840,000 and sales returns and allowance 30,000

Klein’s Tools is considering offering a cash discount to speed up the collection of accounts receivable

E15–5 Klein’s Tools is considering offering a cash discount to speed up the collection of accounts receivable. Currently the firm has an average collection period of 65 days, annual sales are 35,000 units, the per-unit price is $40, and the per-unit variable cost is $29. A 2% cash discount is being considered. Klein’s Tools estimates that 80% of its customers will take the 2% discount. If sales are expected to rise to 37,000 units per year and the firm has a 15% required rate of return, what minimum averagecollection period is required to approve the cash discount plan?

Click here for the solution: Klein’s Tools is considering offering a cash discount to speed up the collection of accounts receivable

At the end of 2010 Sorter Company has accounts receivable of $900,000 and an allowance for doubtful accounts of $40,000

E7-8 (Recording Bad Debts) At the end of 2010 Sorter Company has accounts receivable of $900,000 and an allowance for doubtful accounts of $40,000. On January 16, 2011, Sorter Company determined that its receivable from Ordonez Company of $8,000 will not be collected, and management authorized its write-off.

Instructions
(a) Prepare the journal entry for Sorter Company to write off the Ordonez receivable.
(b) What is the net realizable value of Sorter Company’s accounts receivable before the write-off of the Ordonez receivable?
(c) What is the net realizable value of Sorter Company’s accounts receivable after the write-off of the Ordonez receivable?

Click here for the solution: At the end of 2010 Sorter Company has accounts receivable of $900,000 and an allowance for doubtful accounts of $40,000

On August 31, the balance sheet of Donahue Veterinary Clinic showed Cash $9,000, Accounts Receivable $1,700, Supplies $600, Equipment $6,000

On August 31, the balance sheet of Donahue Veterinary Clinic showed Cash $9,000, Accounts Receivable $1,700, Supplies $600, Equipment $6,000, Accounts Payable $3,600, Common Stock $13,000, and Retained Earnings $700. During September, the following transactions occurred.

1. Paid $2,900 cash for accounts payable due.
2. Collected $1,300 of accounts receivable.
3. Purchased additional office equipment for $2,100, paying $800 in cash and the balance on account.
4. Earned revenue of $7,300, of which $2,500 is paid in cash and the balance is due in October.
5. Declared and paid a $400 cash dividend
6. Paid salaries $1,700, rent for September $900, and advertising expense $200.
7. Incurred utilities expense for month on account $170.
8. Received $10,000 from Capital Bank on a 6-month note payable.

(a) Prepare a tabular analysis of the September transactions beginning with August 31 balances. (If a transaction causes a decrease in Assets, Liabilities or Stockholders' Equity, place a negative sign (or parentheses) in front of the amount entered for the particular Asset, Liability or Equity item that was reduced. See Illustration 1-8 for example.)
(b) Prepare an income statement for September, a retained earnings statement for September, and a balance sheet at September 30.

Click here for the solution: On August 31, the balance sheet of Donahue Veterinary Clinic showed Cash $9,000, Accounts Receivable $1,700, Supplies $600, Equipment $6,000

(Size of Accounts Receivable) The Sand Surfer Corporation has annual sales of $38 million

(Size of Accounts Receivable) The Sand Surfer Corporation has annual sales of $38 million. The average collection period is 34 days. What is the average investment in accounts receivable as shown on the balance sheet? Assume 365 days per year.

Click here for the solution: (Size of Accounts Receivable) The Sand Surfer Corporation has annual sales of $38 million

Dorough Pointers Inc. expects to begin operations in January 1, 2009

Problem 14-16 Preparing a Sales Budget and Schedule of Cash Receipts

Dorough Pointers Inc. expects to begin operations in January 1, 2009. Dorough expects sales in January 2009 to total $120,000 and to increase 10 percent per month in February and March. All sales are on account. Dorough expects to collect 70 percent of accounts receivable in the month of sale, 20 percent in the month following the sale, and 10 percent in the second month following the sale.

Required
a. Prepare a sales budget for the first quarter of 2009.
b. Determine the amount of sales revenue Dorough will report on the first 2009 quarterly pro forma income statement.
c. Prepare a cash receipts schedule for the first quarter of 2009.
d. Determine the amount of accounts receivable as of March 31, 2009.

Check:
c.Feb.: $116,400
March: $140,040

Click here for the solution: Dorough Pointers Inc. expects to begin operations in January1, 2009