The Following Is a Portion of the Current Assets Section

question 13

Essay

The following is a portion of the current assets section of the balance sheets of The Sweet Cafe at December 31, 2014 and 2013: $$\begin{array} { | l | c | r | } \hline & 12 / 31 / 14 & 12 / 31 / 13 \\\hline \text { Accounts receivable, less allowance for bad debts of } & \$ 243,600 & \$ 215,800 \\\$ 7,200 \text { and } \$ 5,100 \text {, respectively. } & & \\\hline\end{array}$$ (a.) If bad debts expense for 2014 totaled $16,400, what was the amount of accounts receivable written off during the year?
(b.) The December 31, 2014, Allowance account balance includes $8,400 for a past due account that is not likely to be collected. This account has not been written off. If it had been written off, what would have been the effect of the write off on:
(1.) The current ratio at December 31, 2014?
(2.) Net income and ROE for the year ended December 31, 2014?
(c.) What do you suppose was the level of The Sweet Cafe's sales in 2014, compared to 2013? Explain your answer.

---

Definitions:

Scripted

Following a pre-defined set of instructions or a detailed plan, often with little room for deviation or improvisation.

Leadership Making

A process of developing, shaping, and influencing others into leaders or enhancing their leadership capabilities.

Out-group

Members of a group who do not identify with the core or dominant group, often receiving less support and fewer resources from the leader.

Mature Partnership Phase

A stage in a relationship or collaboration where all parties involved have developed a stable, trusting, and mutually beneficial bond.