Question Details

(Solved) From its first day of operations to December 31, 2017, Cheyenne Corp. provided for uncollectible accounts receivable under the allowance method:


From its first day of operations to December 31, 2017, Cheyenne Corp. provided for uncollectible accounts receivable under the allowance method: entries for bad debt expense were made monthly based on 2.40% of credit sales, bad debts that were written off were charged to the allowance account, recoveries of bad debts previously written off were credited to the allowance account, and no year-end adjustments were made to the allowance account. Cheyenne’s usual credit terms were net 30 days, and remain unchanged.


The balance in Allowance for Doubtful Accounts was $184,100 at January 1, 2017. During 2017, credit sales totalled $9.00 million, interim entries for bad debt expense were based on 2.40% of credit sales, $95,300 of bad debts were written off, and recoveries of accounts previously written off amounted to $13,000. Cheyenne upgraded its computer facility in November 2017, and an aging of accounts receivable was prepared for the first time as at December 31, 2017.


A summary of the aging analysis follows:


Classification by Month of Sale Balance in Each Category Estimated % Uncollectible
November-December 2017 $1,078,000 8%
July-October 2017 635,000 13.2%
January-June 2017 427,500 22%
Before January 1, 2017 145,500 63%


Based on a review of how collectible the accounts really are in the “Before January 1, 2017” aging category, additional receivables totalling $68,000 were written off as at December 31, 2017. The 63% uncollectible estimate therefore only applies to the remaining $77,500 in the category. Finally, beginning with the year ended December 31, 2017, Cheyenne adopted a new accounting method for estimating the allowance for doubtful accounts: it now uses the amount indicated by the year-end aging analysis of accounts receivable.

Prepare a schedule that analyzes the changes in Allowance for Doubtful Accounts for the year ended December 31, 2017. (Hint: In calculating the allowance amount at December 31, 2017, subtract the $68,000 write off of receivables.)

 


Solution details:
STATUS
Answered
QUALITY
Approved
ANSWER RATING

This question was answered on: Sep 05, 2019

PRICE: $18

Solution~000200077848.zip (25.37 KB)

Buy this answer for only: $18

This attachment is locked

We have a ready expert answer for this paper which you can use for in-depth understanding, research editing or paraphrasing. You can buy it or order for a fresh, original and plagiarism-free solution (Deadline assured. Flexible pricing. TurnItIn Report provided)

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
SiteLock

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

Sep 05, 2019

EXPERT

Tutor

ANSWER RATING

GET INSTANT HELP/h4>

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • As a reference for in-depth understanding of the subject.
  • As a source of ideas / reasoning for your own research (if properly referenced)
  • For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

NEW ASSIGNMENT HELP?

Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN YOUR SET DEADLINE.

Order Now