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QUESTION 7a:

Alpha Company prepares quarterly adjusting entries. On November1, 2017, Alpha Company purchased equipment with a sticker price of$8,515 and signed a note due in 9 months for $10,000 that includedinterest in the value of the note. Use this information to preparea general journal entry for the August 1 equipment purchase.Prepare any additional general journal adjusting entries for FiscalYears 2017 & 2018. Additionally, prepare the general journalentry to record the payment of the note when due in 2018.

General Journal

General Journal

Date	Accounts	Debit	Credit
11/1/17
12/31/17
3/31/18
6/30/18
7/31/18

QUESTION 7b:

Alpha Company uses aging of Accounts Receivable to estimateuncollectible. The unadjusted Trial Balance amount of AccountsReceivable on December 31, 2016, has a balance that consistsof:

Days outstanding	Amount	Estimated Uncollectible
0 – 60	$300,000	1%
61 – 120	90,000	2%
Over 120	100,000	6%
Total	$490,000	4,005

Activity during FiscalYear 2016, for Alpha Company consisted ofJuly 15 Alpha wrote of the Bravo Zulu Company account as notcollectable for the amount of $8,500.

Oct. 20 Alpha company recovered $5,500 from the Charlie DeltaCompany for settlement of their prior debt that had been off duringFY 2015.

Alpha Company’s December 31, 2015 allowance for uncollectibleaccounts was $2,700/ Under the aging method, what amounts shouldAlpha Company report at December 31, 2016 for:

1. Allowance for Uncollectible Accounts

2. Bad Debt Expense

ANSWER 7:

           1.___________________________

           2.___________________________