Acc 101 Chapter 8 Receivables Practice Problems PDF

***ANSWERS TO EXTRA PRACTICE PROBLEMS FOR CHAPTER 8*** [PRACTICE PROBLEM: WRITING OFF AN UNCOLLECTIBLE ACCOUNT RECEIVABLE] **Requirement 1: On July 31, record the journal entry to write off a \$7,000 receivable of Forrest Gump that cannot be collected.** **Requirement 2: On October 31, record the...

***ANSWERS TO EXTRA PRACTICE PROBLEMS FOR CHAPTER 8*** [PRACTICE PROBLEM: WRITING OFF AN UNCOLLECTIBLE ACCOUNT RECEIVABLE] **Requirement 1: On July 31, record the journal entry to write off a \$7,000 receivable of Forrest Gump that cannot be collected.** **Requirement 2: On October 31, record the journal entry to record the recovery of a \$7,000 receivable from Forrest Gump (the receivable that was written off in the previous entry.)** [PRACTICE PROBLEM: ADJUSTING ENTRY FOR UNCOLLECTIBLE ACCOUNTS RECEIVABLE] Lt. Dan's Shrimp Boat Company's year-end receivables are categorized as follows: The Allowance for Doubtful Accounts has a credit balance of \$600. **Requirement 1: Lt. Dan's Shrimp Boat Company records its bad debts based upon aging its accounts receivable. Record the December 31 adjusting entry to record Bad Debt Expense.** - [ALLOWANCE FOR DOUBTFUL ACCOUNTS] - **Requirement 2: Refer back to requirement 1 -- use this same data, but now assume that the beginning balance in the Allowance for Doubtful Accounts is \$600 [DEBIT] (not credit.) Record the adjusting entry to record Bad Debt Expense.** [ALLOWANCE FOR DOUBTFUL ACCOUNTS] - [\ PRACTICE PROBLEM: NOTE RECEIVABLE \#1] Requirement 1: Prepare the journal entries required as follows: Nov 1, 2025 We receive a \$100,000, 30-day, 20% promissory note in settlement of an open account receivable (from Broke Bob, who can't pay us) Dec 1, 2025 Broke Bob pays us the amount he owes Dec 26, 2025 We make a \$200,000 loan to Honest Al and receive a 60-day, 16% promissory note Dec 31, 2025 We record any adjusting entries required (NOTE: as of year-end, he has had the use of our money for 5 days so far; we have earned interest for these 5 days but have not yet received it; it is owed to us) Feb 24, 2026 Honest Al isn't so honest -- he dishonors his note! Total interest = \$200,000 \* 16% \* 60/360 = \$5,333.33 [PRACTICE PROBLEM: NOTE RECEIVABLE \#2] Requirement 1: Prepare the journal entries required as follows: Dec 3, 2025 We make a \$70,000 loan to Saving Sally and receive a 90-day, 11% promissory note Dec 31, 2025 We record any adjusting entries required (NOTE: as of year-end, she has had the use of our money for 28 days so far; we have earned interest for these 28 days but have not yet received it; it is owed to us) Mar 3, 2026 Saving Sally pays us the amount she owes Total interest = \$70,000 \* 11% \* 90/360 = \$1,925 Mar 1, 2025 We receive a \$95,000, 45-day, 10% promissory note in settlement of an open account receivable (from Debtor Dave, who can't pay us the accounts receivable that he owes us) Apr 15, 2025 Debtor Dave does not pay us when the note matures