Problem 9 : At the beginning of the year, ABC had $100,000 in Accounts Receivable and...

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Problem 9 : At the beginning of the year, ABC had $100,000 inAccounts Receivable and $15,000 in Allowance for Doubtful Accounts.During the year ABC sold $900,000 of product on account andcollected $930,000 in cash. In addition, ABC wrote-off $10,000 ofoutstanding Accounts Receivable because a customer declaredbankruptcy. a) Determine the ending balance in Accounts Receivableand Allowance for Doubtful Accounts before any adjusting entry orprovision for bad debt expense is recorded.
b) Assuming ABC estimates uncollectible accounts as 10% ofoutstanding Accounts Receivable, prepare the required adjustingentry to record bad debt expense at year end.
c) Determine the Net Realizable Value of Accounts Receivable asof year end.

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Solution a Ending balance in Accounts receivable beginning balance sales on account Cash collected written off Accounts receivable 100000 900000 930000 10000 60000 Ending See Answer

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Problem 9 : At the beginning of the year, ABC had $100,000 inAccounts Receivable and $15,000 in Allowance for Doubtful Accounts.During the year ABC sold $900,000 of product on account andcollected $930,000 in cash. In addition, ABC wrote-off $10,000 ofoutstanding Accounts Receivable because a customer declaredbankruptcy. a) Determine the ending balance in Accounts Receivableand Allowance for Doubtful Accounts before any adjusting entry orprovision for bad debt expense is recorded.b) Assuming ABC estimates uncollectible accounts as 10% ofoutstanding Accounts Receivable, prepare the required adjustingentry to record bad debt expense at year end.c) Determine the Net Realizable Value of Accounts Receivable asof year end.