Santana Rey, owner of Business Solutions, realizes that she needs to begin accounting for bad...
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Accounting
Santana Rey, owner of Business Solutions, realizes that she needs to begin accounting for bad debts expense. Assume that Business Solutions has total revenues of $46,000 during the first three months of 2022 and that the Accounts Receivable balance on March 31, 2022, is $22,817.
Required:
1a. Prepare the adjusting entry to record bad debts expense, which are estimated to be 2% of total revenues on March 31, 2022. There is a zero unadjusted balance in the Allowance for Doubtful Accounts at March 31.
1b. Prepare the adjusting entry to record bad debts expense, which are estimated to be 3% of accounts receivable on March 31, 2022. There is a zero unadjusted balance in the Allowance for Doubtful Accounts at March 31.
2. Assume that Business Solutions's Accounts Receivable balance at June 30, 2022, is $20,850 and that one account of $84 has been written off against the Allowance for Doubtful Accounts since March 31, 2022. If Rey uses the method in part 1b, what adjusting journal entry is made to recognize bad debts expense on June 30, 2022?
repare the adjusting entry to record bad debts expense, which are estimated to be 2% of total revenues on March 31,2022 . There is a ero unadjusted balance in the Allowance for Doubtful Accounts at March 31. Journal entry worksheet Note: Enter debits before credits. Prepare the adjusting entry to record bad debts expense, which are estimated to be 3% of accounts receivable on March 31 , 2022 . There is a zero unadjusted balance in the Allowance for Doubtful Accounts at March 31. Note: Do not round intermediate calculations. Journal entry worksheet Record estimated bad debts. Note: Enter debits before credits. Complete this question by entering your answers in the tabs below. Assume that Business Solutions's Accounts Receivable balance at June 30,2022 , is $20,850 and that one account of $84 has been written off against the Allowance for Doubtful Accounts since March 31, 2022. If Rey uses the method in part 1b, what adjusting journal entry is made to recognize bad debts expense on June 30,2022 ? Note: Do not round intermediate calculations. Journal entry worksheet Note: Enter debits before credits
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