The 123110 balance sheet of sock company had accounts

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Reference no: EM13599570

The 12/31/10 balance sheet of Sock Company had Accounts Receivable of $ 500.000 and a credit balance in Allowance for Uncollectable Accounts of $ 33.000. During 2011, the following transactions ocurred: Sales on account $ 1.200.000; Sales allowances $ 50.000: Collections from customers $ 1.165.000; Accounts written off $ 35.000; Previously written off accounts of $ 5.000 were collected.

REQUIRED;

A. Jouralize the2011 transactions.

B. If the company uses the % of Sales basis to estimate bad debt expense and anicipates 2% of net sales to be uncollectable, prepare the AJE for 12/31/11.

C.If the compant uses the % of receivables basis to estimate bad debt expense and determines that uncollectable accounts are expected to be 4% of accounts receivable, prepare the AJE for 12/31/11.

D. Independent of the above facts, briefly explain how accounting for bad debts can be used for eaenings statement.

Reference no: EM13599570

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