Problem - At December 31, 2011, Vizarro Company reports the following results for its calendar-year.
CASH SALES $1,926,940
CREDIT SALES 3,169,000
In addition, it's unadjusted trial balance includes the following
ACCOUNTS RECEIVABLE $960,207 debit
ALLOWANCE FOR DOUBTFUL ACCOUNTS 16,460 debit
QUESTIONS:
Prepare the adjusting entry for Vizarro Co. to recognize bad debts under each of the following independent assumptions
Bad debts are estimated to be 3% of credit sales.
Bad debts are estimated to be 2% of total sales.
An aging analysis estimates that 6% of year-end accounts receivable are uncollectible.
Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December 31, 2011, balance sheet given the facts in Requirement 1a.
Show how Accounts Receivable and the Allowance for Doubtful Accounts appear on its December 31, 2011, balance sheet given the facts in Requirement 1c.