Aaron Servicing showed the following partial unadjusted results at October 31, 2020, its year-end: Part 1 Required: a.
Posted: Thu May 19, 2022 3:44 pm
Aaron Servicing showed the following partial unadjusted results
at October 31, 2020, its year-end:
Part 1
Required:
a. Assuming Aaron estimates bad debts to be 1.5% of
sales, prepare the adjusting entry at October 31, 2020.
b. Show how accounts receivable would be
shown on the October 31, 2020, balance sheet using your
calculations in (a).
Part 2
Required:
c. Instead of (a), assume that Aaron estimates bad
debts to be 5% of outstanding accounts receivable. Prepare the
adjusting entry at October 31, 2020.
d. Show how accounts receivable would be
shown on the October 31, 2020, balance sheet using your
calculations in (c).
at October 31, 2020, its year-end:
Part 1
Required:
a. Assuming Aaron estimates bad debts to be 1.5% of
sales, prepare the adjusting entry at October 31, 2020.
b. Show how accounts receivable would be
shown on the October 31, 2020, balance sheet using your
calculations in (a).
Part 2
Required:
c. Instead of (a), assume that Aaron estimates bad
debts to be 5% of outstanding accounts receivable. Prepare the
adjusting entry at October 31, 2020.
d. Show how accounts receivable would be
shown on the October 31, 2020, balance sheet using your
calculations in (c).