70.2K

Verified Solution

Link Copied!

The Kraft Heinz Company was formed in $2015$ with the merger of Kraft Foods and H$.$J$.$ Heinz Corporation. Assume the company reported the following amounts in its unadjusted trial balance $($in millions$)$ as of December $31,2020$:

$\backslash$table$[[$Accounts Receivable,Debits,Credits$],[$Allowance for Doubtful Accounts,$$6,440,],[$Sales $($assume all on credit$),$$$324,]]$

Required:

Assume Kraft Heinz uses $\frac{1}{2}$ of $1$ percent of sales to estimate its Bad debt expense for the year. Prepare the adjusting journal entry required for the year, assuming no Bad debt expense has been recorded yet. $($If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Enter your answers in millions rounded to the nearest whole dollar number no need to add the $6$ zeros as your numbers are in millions already$)$

Journal entry worksheet

A

Record the Bad debts expenses.

Note: Enter debits before credits.Record the Bad debts expenses.

Note: Enter debits before credits.

$\backslash$table$[[$Transaction$,$General Journa,,Debit,Credit$],[1.,$Bad debt expense,,,$],[$Allowance for doubtful accounts,$,,],[,,,,],[,,,,],[,,,,],[,,,,]]$

Assume instead that Kraft Heinz uses the aging of accounts receivable method and estimates that $$318$ million of its Accounts Receivable will be uncollectible. Prepare the adjusting journal ently required at December $31,2020,$ for recording Bad Debt Expense. $($If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Enter your answers in millions $-$ no need to add the $6$ zeros as your numbers are in millions already.$)$Journal entry worksheet

A

Record the Bad debts expenses.

Note: Enter debits before credits.

$\backslash$table$[[$Transaction$,$General Journal,Debit,Credit$],[1.,,,],[,,,],[,,,],[,,,],[,,,]]$Assume instead that Kraft Heinz uses the aging of accounts receivable method and estimates that $$318$ million of its Accounts Receivable will be uncollectible. Also, assume that the unadjusted balance in Kraft Heinz's Allowance for Doubtful Accounts at December $31,2020,$ was a debit balance of $$40$ million. Prepare the adjusting journal entry required at December $31,2020,$ for recording bad debt expense. $($If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Enter your answers in millions $-$ no need to add the $6$ zeros as your numbers are in millions already.$)$

Journal entry worksheet

A

Record the Bad debts expenses.

Note: Enter debits before credits.

$\backslash$table$[[$Transaction$,$General Journal,Debit,Credit$],[1.,,,],[,,,],[,,,],[,,,],[,,,]]$If one of Kraft Heinz's main customers declared bankruptcy in $2021,$ what journal entry would be used to write off its $$32$ million balance? $($If no entry is required for a transaction$/$event$,$ select $"$No journal entry required" in the first account field. Enter your answers in millions $-$ no need to add the $6$ zeros as your numbers are in millions already.$)$

Journal entry worksheet

A

Record the entry to write$-$off the uncollectable account.

Note: Enter debits before credits.

$\backslash$table$[[$Transaction$,$General Journal,Debit,Credit$],[1.,,,],[,,,],[,,,],[,,,],[,,,]]$

Answer & Explanation Solved by verified expert

See Answer