The following information is available for Quality Book Sales's sales on account and accounts receivable:...
50.1K
Verified Solution
Link Copied!
Question
Accounting
The following information is available for Quality Book Sales's sales on account and accounts receivable:
Accounts Receivable Balance, January 1, 2000
$
78,500
Allowance for Doubtful Accounts, January 1, 2000
4,710
Sales on Account, 2000
550,000
Collections of Accounts Receivable, 2018
556,000
After several collection attempts, Quality Book Sales wrote off $2,850 of accounts that could not be collected. Quality Book Sales estimates that 0.5 percent of sales on account will be uncollectible.
Required
a. Compute the following amounts:
(1) Using the allowance method, the amount of uncollectible accounts expense for 2000.
(2) Net realizable value of receivables at the end of 2000.
1.
Uncollectible accounts expense
2.
Net realizable value
B. Explain why the uncollectible accounts expense amount is different from the amount that was written off as uncollectible.
Multiple Choices
a. Uncollectible accounts expense is an estimate of current receivables that may eventually be uncollectible.
b. Uncollectible accounts expense is the actual amount that was determined in the current accounting period to be uncollectible
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
