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GSU ACCT 2101 - Chapter 8 Webex Copy

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The ledger of Bartow Company at the end of the current year shows Accounts Receivable $78,000, Credit Sales $810,000, and Sales Returns and Allowances $40,000. Prepare entries to record allowance for doubtful accounts.Scenario 1: If Allowance for Doubtful Accounts has a credit balance of $1,100 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 10% of accounts receivable.Bad Debt Expense 6,700Allowance for Doubtful Accounts 6,700Scenario 2: If Allowance for Doubtful Accounts has a debit balance of $500 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be 8% of accounts receivable.Bad Debt Expense 6,740Allowance for Doubtful Accounts 6,740Garrow is a corporation that sells nutrition bars. Based onthe accounts listed below, what are Garrow’s totaltrade receivables?Income tax refund due $500Advance due to the company fromthe company president $3003-month note due from Garrow’s main customer $2,000Interest due this month on the above note $100Due and unpaid from this month’s sales $7,000Due and unpaid from last month’s sales $1,000a. $8,000b. $10,000c. $9,000d. $10,900On January 1, 2020, the Allowance for Doubtful Accounts had a credit balance of $15,000. During 2020, $24,000 of uncollectible accounts receivable were written off. Past experience indicates that the allowance should be 10% of the balance in accounts receivable. If the accounts receivable balance at December 31 was $160,000 what is the required adjustment tothe Allowance for Doubtful Accounts at December 31, 2020?a.$1,000b.$25,000c. $16,000d.$24,000A 90-day note dated March 10, 2021, would mature on:a. June 8, 2021b. June 9, 2021c. June 10, 2021d. June 11, 2021Capital Company lends Brewer Company $60,000 onMarch 1, accepting a four-month, 5% interest note. CapitalCompany prepares financial statements on March 31.What adjusting entry should be made before the financialstatements can be prepared?a. Note Receivable 60,000Cash 60,000b. Interest Receivable 3,000Interest Revenue 3,000c. Cash 750Interest Revenue 750d. Interest Receivable 250Interest Revenue 250Hartley Corporation holds Weber Corporation’s $40,000,180-day, 4% note. The entry made by Harley Corporationwhen the note is collected, assuming no interest haspreviously been accrued is:a. Cash 40,000Notes Receivable 40,000b. Accounts Receivable 40,800Notes Receivable 40,000Interest Revenue 800c. Cash 40,800Notes Receivable 40,000Interest Revenue 800d. Cash 41,600Notes Revenue 40,000Interest Revenue


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