Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. sorrento interior furnishings pty ltd has adopted

Sorrento Interior Furnishings Pty Ltd has adopted the Allowance for Doubtful Debts Method. The Allowance...

90.2K

Verified Solution

Question

Accounting

Sorrento Interior Furnishings Pty Ltd has adopted the Allowance for Doubtful Debts Method. The Allowance for Doubtful Debts as at 1 July 2019 was $7,500 credit (CR). The write-off of bad debts for the 2019 2020 financial year was $8,000. The Allowance for Doubtful Debts as at 30 June 2020 was 7% of credit sales. Credit sales for the 2019 2020 financial year was $130,000 (Disregard GST) What is the adjusting entry to raise the Allowance for Doubtful Debts at 30 June 2020? Group of answer choices

DR: Bad Debts $9,100 CR: Allowance for Doubtful Debts $9,100

DR: Bad Debts $9,600 CR: Allowance for Doubtful Debts $9,600

DR: Accounts Receivable $8,000 & CR: Allowance for Doubtful Debts $8,000

DR: Bad debts $8,000 & CR: Allowance for Doubtful Debts $8,000

Q2

On 1 June 2023, Goodwin Limited acquired the business of Monty Inc. for $280 000. The carrying amount of Monty Inc's net assets at the time of the acquisition was $215 000 while independent valuers calculated their fair value at $250 000. Goodwin Limited should debit 'Goodwill' for the amount of: Group of answer choices

$30 000

$35 000

$0

$65 000

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students