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Chapter 6 Practice Problem

Chapter 6 Practice Problem - historically 2 of credit sales...

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Accounts Receivable - days 1 30 - days 31 60 - days 61 90 > days 90 \$ , 230 000 \$ , 160 000 \$ , 35 000 \$ , 14 000 \$ , 21 000 % uncollectible estimate . % 0 2 . % 1 0 . % 5 0 . % 30 0 Chapter 6 Practice Problem On December 1 st , Tahoe Thunder Inc.’s accounts receivable has a balance of \$260,000. The net realizable value was \$251,900. Tahoe Thunder uses the aging method to estimate bad debt. On December 15 th , Tahoe Thunder wrote off a \$1,500 and a \$400 receivable from a customer that just filed bankruptcy. At the end of December, Tahoe Thunder aged their receivables and the results are below. Tahoe Thunder had \$400,000 of credit sales (they only sell on credit) during the period and
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Unformatted text preview: historically 2% of credit sales have been uncollectible. Required Using the aging method Book a journal entry to write-off the customer’s receivables. Book a journal entry to record bad debt expense for the month of December. What is the net realizable value of A/R at the end of December? How much cash did Tahoe collect during the period from customers? Assume Tahoe Thunder uses the percentage-of-credit-sales method. Book a journal entry to record bad debt expense for the month of December. What is the net realizable value of A/R at the end of December?...
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