The following events occur for The Underwood Corporation during 2021 and 2022, its first two years of operations. June 12, 2021
Provide services to customers on account for $38,600. September 17, 2021 Receive $23,000 from customers on account. December 31, 2021 Estimate that 45% of accounts receivable at the end of the year will not be received. March 4, 2022 Provide services to customers on account for $53,600. May 20, 2022 Receive $10,000 from customers for services provided in 2021. July 2, 2022 Write off the remaining amounts owed from services provided in 2021. October 19, 2022 Receive $43,000 from customers for services provided in 2022. December 31, 2022 Estimate that 45% of accounts receivable at the end of the year will not be received. Required:1. Record transactions for each date. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)2. Post transactions to the following accounts: Cash, Accounts Receivable, and Allowance for Uncollectible Accounts.3. Calculate the net realizable value of accounts receivable at the end of 2015 and 2016.
Dec 31, 2022 Uncollectible Accounts Expense $3,170 $4,770
3. Net Realizable Value of Accounts Receivable at the end of 2021 and 2022:
Accounts Receivable Balance $15,600 $10,600
less Allowance for Doubtful Accounts ($7,200) ($4,770)
Net Realizable Value $8,400 $5,830
a) Allowance for Doubtful is an amount that is estimated which may not be recovered from customers for services rendered. This allowance is made in order to provide for losses that may arise from credit sales. The estimated allowance is 45% of the Accounts Receivable Balance at the end of the year.
b) When a write-off of debts occurs, the Allowance for Doubtful Accounts is adjusted with the direct write-off to reduce the balance.
If the situation described above ever happened to me, I will be assertive to person or persons responsible for the variance. If its the teacher, I would assertively approach the teacher and ask him or her about the difference making sure that whatever my true mark is should be reflected on both credit reports so as to avoid confusions on all those who are in interest.
The TASB, is the Texas Association of School Boards. A bond is an agreement between a company and a person or two or more people on the purchase of an item, most of the times known as a bond. In this case, the agreement is between the school district and the bond holder. The district pays the bondholders interest and the bond holder receives a tax write off for donating to the school district.