Rogala Foods Inc. was formed in 2015 with the merger of Grouch Mayer and Tashamo...
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Accounting
Rogala Foods Inc. was formed in 2015 with the merger of Grouch Mayer and Tashamo Corporation. The company reported the following rounded amounts for the year ended January 3, 2016 (all amounts in millions):
Debits
Credits
Accounts Receivable
$
1,130
Allowance for Doubtful Accounts
$
33
Sales (assume all on credit)
18,400
Required:
Assume Rogala uses 1/4 of 1 percent of sales to estimate its Bad Debt Expense for the year. Prepare the adjusting journal entry required for the year, assuming no Bad Debt Expense has been recorded yet.
Assume instead Rogala uses the aging of accounts receivable method and estimates that $81 of its Accounts Receivable will be uncollectible. Prepare the adjusting journal entry required at January 3, 2016, for recording Bad Debt Expense.
Prepare the journal entry for unadjusted balance in Rogalas Allowance for Doubtful Accounts at January 3, 2016, was a debit balance of $21.
If one of Rogalas customers declared bankruptcy, what journal entry would be used to write off its $10 balance?
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