Awar d 014outof 014points e6 11 recording and

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Unformatted text preview: anation: Sales rev enue ($3,000 + $9,000 + $4,000) Les s : Sales dis c ounts ($9,000 c ollec ted from S × 3% ) Les s : Credit c ard dis c ounts ($3,000 from R × 2% ) Net s ales $ 16,000 270 60 $ 15,670 2. awar d: 0.14 out of 0.14 points E6-11 Recording and Determining the Effects of Bad Debt T ransactions on Income Statement Categories Using the Percentage of Credit Sales Method LO4 During 2012, Giatras Elec tronic s rec orded c redit s ales of $680,000. Bas ed on prior ex perienc e, it es timates a 3.5 perc ent bad debt rate on c redit s ales . Required: 1a. Prepare the journal entry needed on Dec ember 31, 2012, to rec ord the appropriate bad debt ex pens e adjus tment for the y ear 2012. (Om it the "$" sign in your response.) General J ournal Debit 23,800 Bad debt expense Allowance for doubtful accounts Credit 23,800 1b. On Dec ember 31, 2012, an ac c ount rec eiv able for $2,800 from a prior y ear was determined to be unc ollec tible and was written off. Prepare the journal entry needed on Dec ember 31, 2012, to rec ord the write­off of the ac c ount. (Om it the "$" sign in your response.) General J ournal Allowance for doubtful accounts Accounts receivable Debit 2,800 Credit 2,800 2. Complete the following tabulation, indic ating the amount and effec t (+ for inc reas e, − for dec reas e, and NE for no effec t) of eac h trans ac tion. Trans ac tion Net Sales a. NE b. NE Gros s Profit NE NE Inc ome from Operations ­23,800 NE Worksheet E6­11 Recording and Determining the Effects of Bad Debt Transactions on Income Statement Categories Using the Percentage of Credit Sales Method LO4 Learning Objective: 06­04 Estimate, report, and evaluate the effects of uncollectible accounts receivable (bad debts) on financial statements. E6-11 Recording and Determining the Effects of Bad Debt T ransactions on Income Statement Categories Using the Percentage of Credit Sales Method LO4 During 2012, Giatras Elec tronic s rec orded c redit s ales of $680,000. Bas ed on prior ex perienc e, it es timates a 3.5 perc ent bad debt rate on c redi...
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This homework help was uploaded on 02/23/2014 for the course BUSE 30000 taught by Professor N/a during the Winter '12 term at UChicago.

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