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Fofino [41]
2 years ago
13

Bad Debt Expense: Percentage of Credit Sales Method Gilmore Electronics had the following data for a recent year: Cash sales $13

5,000 Credit sales 512,000 Accounts receivable determined to be uncollectible 9,650 The firm's estimated rate for bad debts is 2.2% of credit sales. Required:
I. Prepare the journal entry to write off the uncollectible accounts.
2. Prepare the journal entry to record the estimate of bad debt.
3. If Gilmore had written off $3,000 of receivables as uncollectible during the year, how much would bad debt expense reported on the income statement have changed?
Business
1 answer:
lukranit [14]2 years ago
7 0

Answer:

allowance for bad debt 9,650 debit

           Account receivables 9,650 credit

bad debt expense     11,264 debit

       allowance for bad debt  11,264 credit

the bad debt expense would not change as it is not determnate based on the adjustment of an estimate uncollectible account but, in the percentage of sales which will fail to met the payment.

Explanation:

<em>estimated bad debt:</em>

512,000 x 2.2% = 11,264‬

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On October 15, Eco Brewers had a balance of $4, 390 in its Social Security tax payable account. It posted an additional $4, 390
lbvjy [14]

Answer: The correct answer is "b. Debit $8, 780".

Explanation: The entry that should appear on november 15 for the remittance of the month's social security taxes is "Debit $8, 780"

Because the balance of $ 4390 in its Social Security tax payable account + the additional $ 4390 on its October 31 pay date = $ 8780.

8 0
2 years ago
The Nantell Corporation just purchased an expensive piece of equipment. Assume that the firm planned to depreciate the equipment
gtnhenbr [62]

Answer:

D

Explanation:

Nantell's operating income (EBIT) will increase., because now the company will record lower depreciation expense in the income statement due to increase in the life from 5 to 7 taken for the depreciation purposes. So decline in depreciation will result in higher EBIT.

a. is wrong as lower depreciation means higher net income.

b. is wrong as tax liability will not get impacted as tax will follows old method of depreciation.

c. is incorrect as depreciation is non cash expense thus does not impact cash position and tax has already be on the earlier method.

e. is incorrect as increase in EBIT will result in higher taxable income.

hence option D is the only correct option

4 0
2 years ago
You inherit $300,000 from your parents and want to use the money to supplement your retirement. You receive the money on your 65
spayn [35]

The constant monthly withdrawal amount can be calculated by using PMT  function in excel as in =PMT(rate,nper,pv) where rate = 7% = 0.07/12 (Monthly rate), nper = 20 years = 20*12 = 240 months and pv = 300,000

Constant monthly withdrawal amount  =PMT(0.07/12,240,300000)

Constant monthly withdrawal amount = $2,325.90

Constant monthly withdrawal amount = $2,326 (Option C)

3 0
2 years ago
When bringing to market a new product like the MotorolaOne Zoom, the actual product launch takes place in the __________________
AnnZ [28]

Answer:

Option E: Commercialization

Explanation:

The marketplace is simply dynamic and undergoes different changes and the demand rate for products is also do change. Companies evaluate their already made or existing product line, update it and tries to fit into the standard of their consumers.

In the new product development strategies, companies makes a unique new product development strategy to limit the overuse of time and resources through the method of, organize planning and research, understanding what customer really want thereby definitely resourcing of the said project.

In commercialization, it entails the new product launching procedures (processes). It usually needs heavy promotion and product distribution throughout the network.

6 0
1 year ago
1.How do your financial choices impact the economy? Trace the impact of your financial decisions.
hjlf
<span>Answer;
Every time the procurement purchase or procures goods or services it is participating in the economy.
when you pay taxes to the government you are supporting the economy. Having a job to support your financial needs such as mortgages and bills will save you from going bankrupt and hurting the bank.

Explanation;
Financial decisions are important in any business, for the growth and development of the business, these includes, investments decisions, wages, purchases, loans and debtors.
These financial decisions have a direct or indirect impact on the economy; for example the purchase of goods and services impacts the economy directly, as it facilitates trade, and also the tax charged on the purchased goods and services.</span>
3 0
2 years ago
Read 2 more answers
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