The General Ledger Account for Accounts Receivable Shows a Debit

question 48

Essay

The general ledger account for Accounts Receivable shows a debit balance of $40,000.The Allowance for Uncollectible Accounts has a credit balance of $2,000.Net sales for the year were $250,000.In the past,3 percent of net sales have proved uncollectible.An aging of accounts receivable accounts results in an estimate of $9,000 of uncollectible accounts receivable.Calculate (1)Uncollectible Accounts Expense and (2)the ending balance of the Allowance for Uncollectible Accounts using (a)the percentage of net sales method and (b)the accounts receivable aging method for both (1)and (2).

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Definitions:

Start Date

Refers to the specific date when a company or project officially begins operations or activities.

Fiscal Year

A one-year period used for financial reporting and budgeting, not necessarily aligning with the calendar year.

Tax ID Number

A Tax ID Number, also known as TIN, is a unique identifier assigned to individuals or entities for tax purposes by a government.

Easy Step Interview

A simplified process or set of guidance used in software, often seen in financial or tax preparation programs, to assist users through complex tasks by breaking them down into manageable steps.