Essay

Chapter 3 problems:

1. On August 31, 2006, the following data were accumulated to assist the accountant in preparing the adjusting entries for Osage Realty:

a. Fees accrued but unbilled at August 31 are $7,100.

b. The supplies account balance on August 31 is $3,010. The supplies on hand at August 31 are $1,150.

c. Wages accrued but not paid at August 31 are $1,380.

d. The unearned rent account balance at August 31 is $4,950, representing the receipt of an advance payment on August 1 of three months' rent from tenants.

e. Depreciation of office equipment is $1,120.

Instructions

1. Journalize the adjusting entries required at August 31, 2006.

Problem 3-3A

10-4. The Allowance for Doubtful Accounts account has a year-end credit balance, prior to adjustment, of $450. The bad debts are estimated at 3% of $650,000, the net credit sales. After the appropriate adjusting entry for bad debts, the Allowance for Doubtful Accounts should have a credit balance of

a. $19,500

b. $19,950

c. $19,050

d. $20,400

10-5. The Allowance for Doubtful Accounts account has a year-end credit balance, prior to adjustment of $500. The bad debts are estimated at 7% of $60,000 of outstanding accounts receivable. After the appropriate adjusting entry to recognize the bad debt expense, the Allowance for Doubtful Accounts should have a ___________ credit balance.

a. $4,200

b. $3,200

c. $3,700

d. $5,200

10-7. A firm using the allowance method of accounting for bad debts expense has recovered a bad debt that was written off one year ago. The appropriate journal entry to record the recovery would include a

a. credit to the Allowance for Doubtful Accounts account

b. debit to the Bad Debt Expense account

c. credit to the Bad Debt Expense account

d. debit to the Allowance for Doubtful Accounts account

10-9. A 90-day, 11%, promissory note that is dated June 13 will have a maturity date of

a. September 11

b. September 10

c. September 9

d. September 8

10-10.