Question

At the end of the current year, a company has the following amounts: During the Estimated current for next year year $ 7,200 $ 8,300 $12,500 $9,100 $ 2,400 $ 2,600 Sales returns Sales allowances Sales discounts For what amount would the company report sales returns in its current-year in Multiple Choice $7,200. 0 $9,500. 0 $15,500 0 $22,100. 0

Answer 1

Answer 1 $15500

as

Sales return for current year to be shown = Current year + estimated sales return

= $7200 + $8300

= $15500

Answer 2 Total credit sales for the year

as

Percentage of sales method for accounting for uncollectible focuses on total credit sales during the year and uncollectibles are estimated as a percentage of credit sales for the year

Answer 3 Debit bad debt expense $4000 Credit Allowances for uncollectible accounts $4000

as

following journal entry is passed for this

Bad debt expense = Estimated amount of bad debts for future - credit balance in allowances for uncollectible accounts

= $6500- $2500

= $4000

Date	General journal	Debit	Credit
31-Dec	Bad debts expense	$ 4,000
	Allowance for doubtful accounts	.	$ 4,000
	(Provision made for Allowances for Bad debts)

Answer 4 The number of times a year that the average accounts receivables were collected

as

Receivable turnover ratio is the indicator of that how many times we are able to collect the average debtor in a year, or in other words how frequently debtors are collected