On January 1,2014,Tillit Corporation Changed Its Method of Accounting for Bad

question 79

Essay

On January 1,2014,Tillit Corporation changed its method of accounting for bad debts from the direct write-off method to the allowance method.Tillit's controller determined that an allowance of $33,000 should be established on that date.
(1)Ignoring income taxes,what is the amount of adjustment required,and where would it be reported in the financial statements?
(2)Prepare the journal entry (excluding income taxes)required to adjust the accounts.

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Definitions:

Labor Supply Curve

A graphical representation showcasing the relationship between the wage rate and the quantity of labor workers are willing to supply.

Competitive Firm

A company operating in a market where there are many buyers and sellers, and the firm has little influence over the price of its products.

Competitive Market

A market structure characterized by many buyers and sellers where no single entity can significantly influence prices or market outcomes.

Unions

Organizations formed by workers to protect their rights and interests, typically through collective bargaining with employers.