408 • Working Papers
14-3 ON YOUR OWN, p. 430
Recording notes receivable
1.
Interest
Time in
Maturity
Maturity
Calculations:
Note Maturity Date Interest Maturity Value
NR12
Days from
the
Month
Days
Remaining
Term of the Note 120
TE
$8,000.00 × 6% × 120/360 = $160.00 $8,000.00 + $160.00 = $8,160.00
March 22–31 9 111
April 30 81
May 31 50
June 30 20
July 1–20 20 0
23148_ch14_hr_393-422.indd 408 1/18/18 1:29 AM
Chapter 14 Accounting for Uncollectible Accounts Receivable • 409
© 2019 Cengage®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Name Date Class
14-3 ON YOUR OWN (continued)
2., 3.
GENERAL JOURNAL PAGE 15
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF. DEBIT CREDIT
7 7
8 8
9 9
2., 3.
CASH RECEIPTS JOURNAL PAGE 20
1234567
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF.
GENERAL ACCOUNTS
RECEIVABLE
CREDIT
SALES
CREDIT
SALES TAX
PAYABLE
CREDIT
SALES
DISCOUNT
DEBIT
CASH
DEBIT
DEBIT CREDIT
19 19
8Notes Receivable NR14 1170 3 2 0 0 00
Accounts Receivable/Marshall Sykes 1130
120 3 2 0 0 00
21 Accounts Receivable/Roger Hamm M46 1130
16 Notes Receivable R243 1170 6 0 0 0 00 6 1 2 0 00
23148_ch14_hr_393-422.indd 409 1/18/18 1:29 AM
14-3 ON YOUR OWN (concluded)
2., 3. ACCOUNTS RECEIVABLE LEDGER
ACCOUNT Roger Hamm CUSTOMER NO. 110
DATE ITEM POST.
REF. DEBIT CREDIT DEBIT
BALANCE
3. GENERAL LEDGER
ACCOUNT Accounts Receivable ACCOUNT NO. 1130
DATE ITEM POST.
REF. DEBIT CREDIT
BALANCE
DEBIT CREDIT
20–
May 1 Balance ✔56 1 8 4 50
ACCOUNT Interest Income ACCOUNT NO. 7110
DATE ITEM POST.
REF. DEBIT CREDIT
BALANCE
DEBIT CREDIT
20–
May 1 Balance ✔6 4 8 00
20–
May 21 Dishonored note G15 2 8 5 6 00 2 8 5 6 00
8G15 3 2 0 0 00 52 9 8 4 50
21 G15 2 8 5 6 00 55 8 4 0 50
16 CR20 1 2 0 00 7 6 8 00
21 G15 5 6 00 8 2 4 00
14-1 APPLICATION PROBLEM (LO2, 3), p. 434
Journalizing the adjusting entry for Allowance for Uncollectible Accounts
1.
Age Group Amount Percent Uncollectible
Current $20,489.15 2.0%
1–30 16,487.20 6.0%
31–60 8,415.29 15.0%
2.
GENERAL JOURNAL PAGE 13
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF. DEBIT CREDIT
1 1
2 2
$ 409.78
989.23
1,262.29
Adjusting Entries
20–
14-2 APPLICATION PROBLEM (LO4, 5), p. 434
Recording entries related to uncollectible accounts receivable
1., 2.
GENERAL JOURNAL PAGE 6
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF. DEBIT CREDIT
1 1
2 2
3 3
4 4
5 5
1., 2. ACCOUNTS RECEIVABLE LEDGER
ACCOUNT Durham Supply CUSTOMER NO. 110
DATE ITEM POST.
REF. DEBIT CREDIT DEBIT
BALANCE
20–
May 1Balance ✔9 4 8 50
20–
May 6Allowance for Uncollectible Accounts M89 1135 1 6 4 8 11
Accounts Receivable/Suarez Consulting 1130
140 1 6 4 8 11
14 Allowance for Uncollectible Accounts M92 1135 9 4 8 50
Accounts Receivable/Durham Supply 1130
110 9 4 8 50
23 Accounts Receivable/Foley Corp. M98 1130
14 Written off G6 9 4 8 50
Name Date Class
14-2 APPLICATION PROBLEM (continued)
ACCOUNT Pennington Co. CUSTOMER NO. 130
DATE ITEM POST.
REF. DEBIT CREDIT DEBIT
BALANCE
20–
May 1Balance ✔4 8 8 93
2. GENERAL LEDGER
ACCOUNT Accounts Receivable ACCOUNT NO. 1130
DATE ITEM POST.
REF. DEBIT CREDIT
BALANCE
DEBIT CREDIT
20–
May 1 Balance ✔19 4 8 2 58
June 7 Written off G6 4 8 8 93
6G6 1 6 4 8 11 17 8 3 4 47
14 G6 9 4 8 50 16 8 8 5 97
23 G6 1 1 0 9 80 17 9 9 5 77
June 7G6 4 8 8 93 17 5 0 6 84
29 G6 1 6 4 8 11 19 1 5 4 95
414 • Working Papers
© 2019 Cengage®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
14-2 APPLICATION PROBLEM (concluded)
CASH RECEIPTS JOURNAL PAGE 11
1234567
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF.
GENERAL ACCOUNTS
RECEIVABLE
CREDIT
SALES
CREDIT
SALES TAX
PAYABLE
CREDIT
SALES
DISCOUNT
DEBIT
CASH
DEBIT
DEBIT CREDIT
1 1
1., 2.
20–
23148_ch14_hr_393-422.indd 414 1/18/18 1:30 AM
Chapter 14 Accounting for Uncollectible Accounts Receivable • 415
Name Date Class
© 2019 Cengage®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
14-3 APPLICATION PROBLEM (LO6, 7, 8), p. 435
Recording notes receivable
1.
Note Date Principal
Interest
Rate
Time in
Days Interest
Maturity
Date
Maturity
Value
Calculations:
1.
Note Maturity Date Interest Maturity Value
NR8
Days from
the
Month
Days
Remaining
Term of the Note 90
NR9
Days from
the
Month
Days
Remaining
$25,000.00 × 8% × 90/360 = $500.00 $25,000.00 + $500.00 = $25,500.00
April 16–30 14 76
May 31 45
June 30 15
July 1–15 15 0
23148_ch14_hr_393-422.indd 415 1/18/18 1:30 AM
416 • Working Papers
© 2019 Cengage®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
14-3 APPLICATION PROBLEM (continued)
2.
GENERAL JOURNAL PAGE 16
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF. DEBIT CREDIT
10 10
11 11
12 12
2.
CASH RECEIPTS JOURNAL PAGE 23
1234567
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF.
GENERAL ACCOUNTS
RECEIVABLE
CREDIT
SALES
CREDIT
SALES TAX
PAYABLE
CREDIT
SALES
DISCOUNT
DEBIT
CASH
DEBIT
DEBIT CREDIT
22 22
TE
3Notes Receivable NR10 1170 6 8 0 0 00
Accounts Receivable/Daniel Burris 1130
110 6 8 0 0 00
18 Accounts Receivable/Maggie Singer M240 1130
120 3 8 7 6 00
12 Notes Receivable R204 1170 2 0 0 0 00 2 0 4 0 00
23148_ch14_hr_393-422.indd 416 1/18/18 1:30 AM
Name Date Class
14-3 APPLICATION PROBLEM (concluded)
2., 3. ACCOUNTS RECEIVABLE LEDGER
ACCOUNT Daniel Burris CUSTOMER NO. 110
DATE ITEM POST.
REF. DEBIT CREDIT DEBIT
BALANCE
20–
June 1Balance ✔6 8 0 0 00
3. GENERAL LEDGER
ACCOUNT Accounts Receivable ACCOUNT NO. 1130
DATE ITEM POST.
REF. DEBIT CREDIT
BALANCE
DEBIT CREDIT
20–
June 1 Balance ✔64 0 8 1 13
ACCOUNT Interest Income ACCOUNT NO. 7110
DATE ITEM POST.
REF. DEBIT CREDIT
BALANCE
DEBIT CREDIT
20–
June 1 Balance ✔8 2 9 00
3Accepted note G16 6 8 0 0 00
3G16 6 8 0 0 00 57 2 8 1 13
18 G16 3 8 7 6 00 61 1 5 7 13
12 CR23 4 0 00 8 6 9 00
18 G16 7 6 00 9 4 5 00
14-M MASTERY PROBLEM (LO4, 5, 6, 7, 8), p. 435
Recording entries for uncollectible accounts
1., 2.
GENERAL JOURNAL PAGE 12
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF. DEBIT CREDIT
1 1
2 2
3 3
4 4
5 5
13 13
14 14
15 15
16 16
3.
GENERAL JOURNAL PAGE 13
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF. DEBIT CREDIT
1 1
2 2
20–
Dec. 3Allowance for Uncollectible Accounts M243 1135 4 9 8 25
Accounts Receivable/Patel Corporation 1130
150 4 9 8 25
6Accounts Receivable/Banda Company M244 1130
110 1 5 4 8 25
Allowance for Uncollectible Accounts 1135 1 5 4 8 25
10 Accounts Receivable/Broyles Industries M245 1130
Adjusting Entries
20–
Dec. 31 Uncollectible Accounts Expense 6165 10 2 1 6 38
Name Date Class
© 2019 Cengage®. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
14-M MASTERY PROBLEM (continued)
1., 2.
3.
CASH RECEIPTS JOURNAL PAGE 22
1234567
DATE ACCOUNT TITLE DOC.
NO.
POST.
REF.
GENERAL ACCOUNTS
RECEIVABLE
CREDIT
SALES
CREDIT
SALES TAX
PAYABLE
CREDIT
SALES
DISCOUNT
DEBIT
CASH
DEBIT
DEBIT CREDIT
1 1
2 2
3 3
Age Group Amount Percent Uncollectible
Current $ 52,271.96 1.0%
1–30 32,581.28 2.5%
31–60 12,849.15 7.5%
61–90 9,418.25 25.0%
Over 90 11,848.15 60.0%
20–
Dec. 4Notes Receivable R889 1170 5 0 0 0 00 5 1 0 0 00
Interest Income 7110 1 0 0 00
6 Banda Company R890 110 1 5 4 8 25 1 5 4 8 25
$ 522.72
814.53
963.69
2,354.56
7,108.89
$11,764.39
23148_ch14_hr_393-422.indd 419 1/18/18 1:30 AM
14-M MASTERY PROBLEM (continued)
1., 2., 3. ACCOUNTS RECEIVABLE LEDGER
ACCOUNT Banda Company CUSTOMER NO. 110
DATE ITEM POST.
REF. DEBIT CREDIT DEBIT
BALANCE
ACCOUNT Maples Corporation CUSTOMER NO. 130
DATE ITEM POST.
REF. DEBIT CREDIT DEBIT
BALANCE
20–
Dec. 1 Balance ✔4 5 0 0 00
ACCOUNT Patel Corporation CUSTOMER NO. 150
DATE ITEM POST.
REF. DEBIT CREDIT DEBIT
BALANCE
20–
Dec. 1 Balance ✔4 9 8 25
20–
Dec. 6Reopen account G12 1 5 4 8 25 1 5 4 8 25
6CR24 15 4 8 25
✔
18 Accepted note G12 45 0 0 00
3Written off G12 4 9 8 25
Name Date Class
14-M MASTERY PROBLEM (concluded)
3. GENERAL LEDGER
ACCOUNT Accounts Receivable ACCOUNT NO. 1130
DATE ITEM POST.
REF. DEBIT CREDIT
BALANCE
DEBIT CREDIT
20–
Dec. 1 Balance ✔120 7 1 6 04
ACCOUNT Notes Receivable ACCOUNT NO. 1170
DATE ITEM POST.
REF. DEBIT CREDIT
BALANCE
DEBIT CREDIT
20–
Dec. 1 Balance ✔22 8 0 0 00
ACCOUNT Interest Income ACCOUNT NO. 7110
DATE ITEM POST.
REF. DEBIT CREDIT
BALANCE
DEBIT CREDIT
20–
Dec. 1 Balance ✔1 0 9 5 00
3G12 4 9 8 25 120 2 1 7 79
6G12 1 5 4 8 25 121 7 6 6 04
10 G12 4 8 9 6 00 126 6 6 2 04
14 G12 1 6 4 5 00 125 0 1 7 04
18 G12 4 5 0 0 00 120 5 1 7 04
31 CR24 1 5 4 8 25 118 9 6 8 79
4CR24 5 0 0 0 00 17 8 0 0 00
10 G12 4 8 0 0 00 13 0 0 0 00
18 G12 4 5 0 0 00 17 5 0 0 00
21 CR24 4 0 0 0 00 13 5 0 0 00
4CR24 1 0 0 00 1 1 9 5 00
10 G12 9 6 00 1 2 9 1 00
21 CR24 1 2 0 00 1 4 1 1 00
14-C CHALLENGE PROBLEM (LO2), p. 436
Estimating uncollectible accounts expense
1., 2.
Wood Company
Aging of Accounts Receivable
12/31/20–
Age Group Amount Percent Uncollectible
Current $ 70,728.14
1–30 30,438.99
31–60 14,563.59
3.
2.0% $ 1,414.56
4.0% 1,217.56
8.0% 1,165.09
No, the percentages are not properly matching the expense of uncollectible accounts with revenue.
The November 30 estimate of $16,559.37 was not adequate to cover the accounts written off