Chapter 06 – Reporting and Interpreting Sales Revenue, Receivables, and Cash
Solutions Chapter 6 – Set B Exercises – Libby 8e
E6–1B.
E6–2B.
Sales revenue ($4,500 + $12,000 +$4,000) ………………………… $20,500
E6–3B.
Sales revenue ($6,500 + $600 + $11,000) ………………………….. $18,100
Less: Sales returns and allowances (1/10 x $11,000 from C) ….. 1,100
E6–4B.
Cost of
Transaction
Net Sales
Goods Sold
Gross Profit
July 12
+ 294
+ 165
+ 129
July 15
+ 4,000
+ 2,200
+ 1,800
2
July 20
– 120
NE
– 120
July 21
– 1,500
– 600
– 900
E6–5B.
4.17% x (365 ÷ 50 days) = 30.44%
E6–6B.
(a) Bad debt expense (+E, –SE) ($875,000 x 0.01) …….. 8,750
Allowance for doubtful accounts (+XA, –A) ……. 8,750
E6–7B.
(a) Bad debt expense (+E, –SE) ($879,000 x 0.02) …….. 17,580
Chapter 06 – Reporting and Interpreting Sales Revenue, Receivables, and Cash
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E6–8B.
Aged accounts receivable
Estimated
percentage
uncollectible
Estimated
amount
uncollectible
Not yet due
$18,000
x
2%
=
$ 360
Up to 120 days past due
6,500
x
14%
=
910
Over 120 days past due
3,500
x
35%
=
1,225
Estimated balance in Allowance for Doubtful Accounts
2,495
Current balance in Allowance for Doubtful Accounts
700
Bad Debt Expense for the year
$1,795
E6–9B.
Req. 1
December 31, 2014 -Adjusting entry:
Bad debt expense (+E, –SE) ………………………………… 5,610
Allowance for doubtful accounts (+XA, –A) ……. 5,610
To adjust for estimated bad debt expense for 2014 computed as follows:
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E6–10B.
Req. 1 JENNA COMPANY
Bank Reconciliation
June 30, 2014
Company’s Books
Bank Statement
Ending balance per Cash
account ………………………
$6,700
Ending balance per bank
statement ……………………
$7,560
Additions:
Additions:
None
Deposit in transit* ………
2,200*
9,760
© 2014 by McGraw-Hill Global Education Holdings, LLC. This is proprietary material solely for authorized instructor use. Not authorized for sale
or distribution in any manner. This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole
or part.
5
To record bank service charges deducted from bank balance.
(2) Accounts receivable (Ramon Jones) (+A) ………………………… 370
Cash (–A) …………………………………………………………… 370
To record customer check returned due to insufficient funds.
Req. 3