Explanation:
The journal entry to record the uncollectible is shown below:
On December 31
Bad debt expense $800
To Allowance for doubtful debts $800
(Being the bad debt expense is recorded)
The computation is shown below:
= Sales × estimated percentage - credit balance of doubtful accounts
= $280,000 × 0.5% - $600
= $1,400 - $600
= $800
<h2>Estimated losses on the overall contract are recognized before the contract is completed. </h2>
Explanation:
Revenue recognition cannot be done prior to the completion of contract.
But the asset can be created. Only after the contract gets completed the revenue recognition can be realized.
For a long-term project, the revenue can be recognized based on the percentage of completion.
Revenue recognition keeps financial transactions aligned.
Option A: valid
Option B Invalid, because expenses are also recognized
Option C: This process is acceptable.
Option D: Gains and profits are calculated in this type of method
Answer:
The correct answer is "$9450".
Explanation:
Given:
Payoff from investment,
= $6000
Lending to bank,
= 
= 
Now,
At 15% interest,
The amount to be received from bank will be:
= 
= 
= 
= 
($)
hence,
In her old age, most she can assume will be:
= 
= 
($)
Answer:
If you wait one year, in 45 years you will have $16,624.04 more than investing today.
Explanation:
Giving the following information:
Option 1:
Initial investment= $11,500
Number of years= 45
Interest rate= 4.1%
Option 2:
Initial investment= $11,500
Number of years= 44
Interest rate= 4.7%
To calculate the future value for both options, we need to use the following formula:
FV= PV*(1+i)^n
<u>Option 1:</u>
FV= 11,500*(1.041^45)= $70,142.41
<u>Option 2:</u>
FV= 11,500*(1.047^44)
FV= $86,766.45
If you wait one year, in 45 years you will have $16,624.04 more than investing today.
