Happy Company had a $173,000 balance in Accounts Receivable and a credit balance of $300 in Allowance for Doubtful Accounts at December 31, 2020.
Requirements:
a. Compute the amount of expected bad debts at December 31, 2020.
Answer
4410
b. Prepare the December 31, adjusting entry for for Bad Debt Expense.
c. Assume the same facts as above except that the Allowance for Doubtful Accounts had a $300 debit balance. Prepare the adjusting entry for Bad Debt Expense.
d. What is the net realizable value of accounts receivable at December 31, 2020?
(How much cash does the company expect to collect)
Answer
Record the following transactions in the journal of Top Dog Running Shoes:
2019
Aug 1 Loaned $20,000 to Jean Porter, an executive with the company, on a one-year 12% note.