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ac116 Unit 3 Wiley

ac116 Unit 3 Wiley

Daniel Kevins

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Problem 9-3A

Presented below is an aging schedule for McCann Company.

			Number of Days Past Due
Customer	Total	Not Yet Due	1–30	31–60	61–90	Over 90
Amos	$ 24,900		$11,500	$13,400
Brian	41,700	$ 41,700
Chevy	59,900	17,700	6,700		$35,500
Drake	36,200					$36,200
Others	135,700	97,800	16,100	14,900		6,900
	$298,400	$157,200	$34,300	$28,300	$35,500	$43,100
Estimated Percentage Uncollectible		2%	4%	13%	25%	61%
Total Estimated Bad Debts	$ 43,361	$ 3,144	$ 1,372	$ 3,679	$ 8,875	$26,291

At December 31, 2012, the unadjusted balance in Allowance for Doubtful Accounts is a credit of $13,770.

(a)

Journalize and post the adjusting entry for bad debts at December 31, 2012. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date	Account Titles and Explanation	Debit	Credit
Dec. 31	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]

Bad Debts Expense
Date	Explanation	Ref	Debit	Credit	Balance
Dec. 31	Adjusting		[removed]	[removed]	[removed]
Allowance for Doubtful Accounts
Date	Explanation	Ref	Debit	Credit	Balance
Dec. 31	Balance		[removed]	[removed]	[removed]
Dec. 31	Adjusting		[removed]	[removed]	[removed]

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(b)

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(c)

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Problem 9-6A

Manatee Company closes its books monthly. On September 30, selected ledger account balances are:

Notes Receivable		$99,600
Interest Receivable		372

Notes Receivable include the following.

Date	Maker	Face	Term	Interest
Aug. 16	M. Bear Inc.	$ 25,200	60 days	8%
Aug. 25	Pope Co.	12,000	60 days	10%
Sept. 30	Quackers Corp.	62,400	6 months	9%

Interest is computed using a 360-day year. During October, the following transactions were completed.

Oct. 7		Made sales of $7,680 on Manatee credit cards.
12		Made sales of $1,400 on MasterCard credit cards. The credit card service charge is 2%.
15		Added $521 to Manatee customer balance for finance charges on unpaid balances.
15		Received payment in full from M. Bear Inc. on the amount due.
24		Received notice that the Pope note has been dishonored. (Assume that Pope is expected to pay in the future.)

(a)

Journalize the October transactions and the October 31 adjusting entry for accrued interest receivable. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Use 360 days for calculation.)

Date	Account Titles and Explanation	Debit	Credit
Oct. 7	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
Oct. 12	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
Oct. 15	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
Oct. 15	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
Oct. 24	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]
Oct. 31	[removed]	[removed]	[removed]
	[removed]	[removed]	[removed]