Journalize the adjusting entry at december

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Reference no: EM13512573

The ledger of Molina Company at the end of the current year shows Accounts Receivable $86,000; Credit Sales $780,000; and Sales Returns and Allowances $40,000.

Instructions

(a) If Molina uses the direct write-off method to account for uncollectible accounts, journalize the adjusting entry at December 31, assuming Molina determines that Banner's $900 balance is uncollectible.

(b) If Allowance for Doubtful Accounts has a credit balance of $1,100 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 10% of accounts receivable.

(c) If Allowance for Doubtful Accounts has a debit balance of $500 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 8% of accounts receivable.

 

Reference no: EM13512573

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