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ACC 281 Week 3 Individual Assignment
Week 3 Individual Assignment
University of Phoenix
ACC 281
xxxxxx
xxxx
E9-3
The ledger of Hixson Company at the end of the current year shows Accounts Receivable $120,000, Sales $840,000, and Sales Returns
and Allowances $30,000.
Instructions
(a) If Hixson uses the direct write-off method to account for uncollectible accounts, journalize the adjusting entry at December 31;
assuming Hixson determines that Fell’s $1,400 balance is uncollectible.
Dec
31
Bad Debt Expense
1,400
Account Receivable
(To record uncollectible balance fro Fell)
1,400

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(b) If Allowance for Doubtful Accounts has a credit balance of $2,100 in the trial balance, journalize the adjusting entry at December 31,
assuming bad debts are expected to be (1) 1% of net sales, and (2) 10% of accounts receivable.
Dec
31
Bad Debts Expense
8,100
Allowance for Doubtful Accounts
(To record bad debt exp. $84,000-$30,000×1%)
8100
Bad Debts Expense
9,900
Allowance for Doubtful Accounts
(To record bad debt exp. $120,000×10%-$2,100)
9,900
(c) If Allowance for Doubtful Accounts has a debit balance of $200 in the trial balance, journalize the adjusting entry at December 31,
assuming bad debts are expected to be (1) 0.75% of net sales and (2) 6% of accounts receivable.
Dec
31
Bad Debts Expense
Allowance for Doubtful Accounts
6,075

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ACC 281 Week 3 Individual Assignment  Week 3 Individual Assignment University of Phoenix ACC 281 xxxxxx xxxx       E9-3 The ledger of Hixson Company at the end of the current year shows Accounts Receivable $120,000, Sales $840,000, and Sales Returns and Allowances $30,000.   Instructions (a) If Hixson uses the direct write-off method to account for uncollectible accounts, journalize the adjusting entry at December 31; assuming Hixson determines that Fell’s $1,400 balance is uncollectible.   Dec 31 Bad Debt Expense 1,400      Account Receivable (To record uncollectible balance fro Fell) 1,400   (b) If Allowance for Doubtful Accounts has a credit balance of $2,100 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 1% of net sales, and (2) 10% of accounts receivable.   Dec 31 Bad Debts Expense 8,100      Allowance for Doubtful Accounts (To record bad debt exp. $84,000-$30,000×1%) 8100 Bad Debts Expense 9,900      Allowance for Doubtful Accounts (To record bad debt exp. $120,000×10%-$2,100) 9,900   (c) If Allowance for Doubtful Accounts has a debit balance of $200 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 0.75% of net sales and (2) 6% of accounts receivable.   Dec 31 Bad Debts Expense 6,075      Allowance for Doubtful Accounts (To record bad debt exp. $840,000-$30,000x.75%) 6,075 Bad Debts Expense ...
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