Perpetual System

Wk 3 Assignment 1 5-24, 5-26
5-24 Determining handbill balances: % of tax revenue accommodation method of accounting for unsound accounts
The following data pertains to Lesliess Floor Store sales on account and accounts receivable: Account Receivable balance, January 1, 2012 $52,500
Allowance for doubtful accounts, January, 1, 2012 $4,725
sales on account, 2012 $925,000
Cost of goods sold, 2012 $615,000
Collections of accounts receivable, 2012 $835,000

Required
a. Compute the following amounts
1. Using the everyow method, the amount of uncollectible accounts expense for 2012
925,000 * 0.5 = bad debt of $4,625
2. Net achievable cheer of receivables at the end of 2012
$52,000 4,725 = $47,775
b. Explain why the uncollectible accounts expense amount is different from the amount that was write impinge on as uncollectible
The amounts are different because when they do the write attain amount it is an estimated amount on what they think would probably written off and not received from the customer

5-26 Determination of account balances - % of receivables wages method of accounting for uncollectible accounts
During the 1st year of operation, 2012, Martins Appliance recognized $292,000 of service revenue on account. At the end of 2012, the accounts receivable balance was $57,400.



Even though this is the stolon in business, the owner believes he will collect all but about 4% of the ending balance
a. What amount of specie was collected by Martins during 2012?
$292,000-$57,400=$234,600
b. Assuming the use of an allowance system to account for uncollectible accounts, what amount should Martin record as uncollectible accounts expense in 2012?
$57,400 * .04 = $2,296
c. What is the net realizable value of receivables at the end of 2012?
$57,400 $2,296 = $55,104
d. Show the effects of the above proceedings on the financial statements by recording appropriate amounts in a horizontal statements model. When you record amounts in the...If you want to hit a full essay, order it on our website: Ordercustompaper.com



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