英财 2013第七章答案.docVIP

Ex. 7.8 a. Uncollectible Accounts Expense ……………………………………………………………… 200,000 　 　 　 Allowance for Doubtful Accounts………………………………….. 　 200,000 　 　 To record estimated uncollectible accounts expense at 2.5% of net credit sales ($8,000,000 x 2.5% = $200,000). 　 　 　 　 　 　 　 　 　 b. Uncollectible Accounts Expense …………………………………………………… 155,000 　 　 　 　 Allowance for Doubtful Accounts………………………………….. 　 155,000 　 　 To increase balance in allowance account to required $84,000: 　 　 　 　 　 　 　 　 Credit balance at beginning of year………………………… $ 25,000 　 　 　 　 Write-offs during year…………………………………….. (96,000) 　 　 　 Temporary debit balance………………………………. $ 71,000 　 　 　 Required year-end credit balance ………….………….…. 84,000 　 　 　 Required adjustment for year………………………………. $ 155,000 　 　 c. Uncollectible Accounts Expense………………………………. …….. 96,000 　 　 　 　 Accounts Receivable…………….………………………………. 96,000 　 　 To record as uncollectible expense only those accounts determined during the year to be uncollectible. 　 　 　 　 　 d. Adjusting the balance in the Allowance for Doubtful Accounts account based upon the aging schedule will provide to investors and creditors the most accurate assessment of the company’s liquidity. This method is the only approach to take into consideration the underlying declining probability of collecting outstanding accounts as they become increasingly past due. 　 　 　 　 　 　 　 　 SOLUTIONS TO PROBLEMS 7.1 a. 　 　 　 　 　 　 BANNER, INC. Bank Reconciliation July 31 Balance per bank statement, July 31 　 　 $ 114,828 Add: Deposit in transit 　 16,000 　 　 $ 130,828 Deduct: Outstanding checks 　 　 　 no. 811 　 $ 314 　 no. 814 　 625 　 no. 823 　 175 1,114 Adjusted cash balance 　 　 $ 129,714 Balance