sAssume thu CUMULATIVE REVIEW PROBLEM CHAPTER 10 The purpose

s.Assume thu CUMULATIVE REVIEW PROBLEM: CHAPTER 10 The purpose of this problem is to procide an opportunity to reciec both neaw concepts in the current chapter and major concepts in previous chapters. This cumulative recieo should assist you in integrating accounting concepts and preparing for exans. n January L months o REQUIRED: Answer each of the following eleven questions Us e the following data for the next four questions On December 31, 2011, the unadjusted trial balance of Alex Ine., included the following accounts: Credit $900,000 Debit Sales (90% represent credit sales) Accounts Receivable Allowance for Doubtful Accounts $300,000 300 I. Assume Alex estimates bad debts expense as 1% ofcredit sales. Prepare the adjusting entry for con ut for the bad debts on December 31, 201 D of #1, Assume Alex estimates bad debts expense as 3% of yearend Prepare the adjusting entry for bad debts on December 31, 2011. gross accounts on your answer in #2. Assunne Alex estimates bad debts expense counts receivable. Ater the adjusting entry, the net realizable value of Aler\'s ecevable in the December 31, 2011 balance sheet is: s. as 3% of year-end gross f conta 3. Based on your

Solution

Solution 1:

Solution 2:

Adjusted Ending Balance Of allowance for doubtful accounts = Year end accounts receivable *3% = $300,000*3% = $9,000

Bad debt expenses to be recorded dec 31, 2011 = Adjusted Ending Balance Of allowance for doubtful accounts - unadjusted balance of allowance for doubtful accounts = $9000 - 300 = $8700

Solution 3:

Net realizable value of accounts receivables in Dec 31, 2011 balace sheet = Accounts receivable - Adjusted Balance Of allowance for doubtful accounts

= $300,000 - $9000 = $291,000

Solution 4:

Solution 5:

Net realizable value of of accounts receivables in Jan 08, 2012 balace sheet =(Gross Accounts Receivale - write off amount) - (Adjusted Balance Of allowance for doubtful accounts - write off amount)

= ($300000- $800) - ($9000 - $800) = $291,000

Note: As per chegg policy, i have answered sufficient parts of the question. Please post separarte questions for answers of remaining portion.

Adjusting Journal Entries
Date	Particulars	Debit	Credit
31-Dec-11	Bad Debt expense Dr ($900,000*90%*1%)	$8,100.00
	To allowance for doubtful accounts		$8,100.00
	(Being allowance for doubtful accounts as 1% of credit sales provided)