Reference no: EM132781144
Questions - A series of unrelated situations follow for several companies that use ASPE:
Q1. Skysong Inc.'s unadjusted trial balance at December 31, 2020, included the following accounting:
Allowance for doubtful accounts $8,400, (debt)
Sales revenue $2,040,000 (credit balance), Sales returns and allowances 60,900 (debt)
Sales discounts 4,900 (debt)
Skysong estimates its bad debt expense to be 1.0% of net sales. Determine its bad debt expense for 2020.
Q2. An analysis and aging of Concord Corporation's accounts receivable at December 31, 2020, disclosed the following:
Amounts estimated to be uncollectible $164,000
Accounts receivable 1,755,000
Allowance for doubtful accounts (per books) 123,000
What is the net realizable value of Concord Corporation's receivables at December 31, 2020?
Q3. Sheridan Company provides for doubtful accounts based on 4.5% of credit sales. The following data are available for 2020:
Credit sales during 2020 $3,200,000
Allowance for doubtful accounts 1/1/20 35,700
Collection of accounts written off in prior years (customer credit was re-established) 17,100
Customer accounts written off as uncollectible during 2020 36,000
What is the balance in Allowance for Doubtful Accounts at December 31, 2020?
Q4. At the end of its first year of operations, on December 31, 2020, Skysong Inc. reported the following information:
Accounts receivable, net of allowance for doubtful accounts $980,000
Customer accounts written off as uncollectible during 2020 23,200
Bad debt expense for 2020 95,000
What is the balance in accounts receivable at December 31, 2020, before subtracting the allowance for doubtful accounts?
Q5. The following accounts were taken from Shamrock Inc.'s unadjusted trial balance at December 31, 2020:
Debt Credit
Sales revenue (all on credit) $980,000
Sales discounts $22,300
Allowance for doubtful accounts 32,400
Accounts receivable 740,000
If doubtful accounts are 7% of accounts receivable, what is the bad debt expense amount to be reported for 2020?