Answer:
A) dependence
Explanation:
Power and dependency are fundamental issues in supply chain management. When a firm has more potential suppliers, the bargaining power of the firm increases (due to greater competition). But if a firm has a small number of potential suppliers, then the bargaining power of the firm decreases.
In this case, Levin and Co. had no bargaining power over its supplier because it was totally dependent on it, it didn't have any alternative suppliers.
Assume that the Uncovered Interest Parity (UIP) holds. If the rate of retum on a euro asset is 8 percent and the rate of return on a comparable dollar asset is 4 percent, the expected rate of dollar depreciation must be
A. -5 percent.
B. 4 percent.
C. -3 percent.
D. -4 percent.
Answer:
D. -4 percent.
Explanation:
Rate of return on Euro assets = 8%
Rate of return on Dollar assets = 4%
As per the Uncovered Interest Parity condition,
Expected rate of depreciation of the dollar
= Rate of return on Dollar assets - Rate of return on Euro assets
= 4% - 8%
= -4%
Therefore, The expected rate of dollar depreciation must be -4%.
Transfer payments and subsidies now account for approximately
Answer:
Half or 50% of the federal budget.
Explanation :
A subsidy, which is also known as government incentive is a form of financial aid or support extended to a business, or individual, generally with the aim of promoting economic and social policy. Transfer payments and subsidies now account for approximately half or 50% of the federal budget.
Last summer, to earn money for their college tuition, George and Tom operated a food kiosk at Clearwater Beach, Florida for 3 months. They sold soft drinks, chips, crackers, and candy bars. A month before they were planning to open, Larry found a location that rented for $500 a month and a small refrigerator unit which they rented for $60 per month. Alan found distributors for the food products as well as for the paper products that they would need. Alan also purchased a business license for $80 and bought 3-month's worth of liability insurance for $100. The cups, straws, napkins, and extra sales people needed to staff the stand are all examples of:Marginal costs.Break even points.Variable costs.Fixed costsAverage costs.
Answer: Fixed Costs
Explanation: Fixed Costs are cost incurred by an organisation during the cause of business.
They are fixed in nature which means they are incurred in as much as the business is operational. They are costs that must be incurred on the business and they include salaries and wages, cost of consumables, rent, rate etc.
Fixed costs are constant when calculating the profit or loss of a business.
Brenda has been offered choices when selecting her benefits. She knows she wants health insurance, is unsure of vision insurance, and does not want dental insurance. This is allowed because her employer has
Answer:
The correct answer is flex-plans.
Explanation:
These plans allow employees to choose the benefits they prefer or want, instead of being selected by the organization's administration. In this way the employee adapts the benefits package to his needs. For example, an employee in the manufacturing area who has great concern for his well-being or health, might prefer the benefit of additional life insurance.
In short there are many alternative benefits for which they can opt.
The precise advantages of these plans and consequently the reasons why they are becoming increasingly popular are:
1. They allow employees to make relevant decisions about their individual finances and balance requirements with benefit plans.
2. Plans help organizations control costs, especially health. This is because managers can define the maximum amount they will use in each benefit. In other words, flexible payment plans often produce savings for organizations.
3. These plans become instruments to control and keep employees.
For employees, flexibility can be attractive, since in this way they can design their benefits and coverage levels based on their own requirements, therefore, in this sense, benefit plans become an advantage for them.
Xeris, Inc. has 1,000 shares of 5%, $100 par value, cumulative preferred stock and 50,000
shares of $1 par value common stock outstanding at December 31, 2010. What is the
annual dividend on the preferred stock?
a. $50 per share
b. $5,000 in total
c. $500 in total
d. $.50 per share
Answer:
b. $5,000 in total
Explanation:
Preference shares which are cumulative in nature, require a fixed dividend, even in case it is not paid in the current year, the amount gets accumulated and then had to be paid in next year.
But in no manner the payment can be declined.
The rate written as a prefix to preference shares provide for the fixed dividend.
In the given case 5%
Total par value of preference shares = $100 [tex]\times[/tex] 1,000 = $100,000
Dividend = 5% of $100,000 = $5,000
Final answer:
The annual dividend on the preferred stock for Xeris, Inc. is $5 per share, resulting in a total annual dividend of b. $5,000 for all 1,000 shares.
Explanation:
The annual dividend on the preferred stock for Xeris, Inc. is calculated by taking the percentage of the dividend rate times the par value of each share. Since Xeris, Inc. has 1,000 shares of 5%, $100 par value cumulative preferred stock, you multiply 5% (or 0.05 as a decimal) by the $100 par value to find the dividend per share.
Then, multiply that dividend per share by the total number of preferred shares to find the total annual dividend. The dividend per share is $5.00 (0.05 x $100), and the total annual dividend for all 1,000 shares would be $5,000 (1,000 x $5.00). Therefore, the correct answer is b. $5,000 in total.
Caddo Corporation is owned by three engineers, all of whom are employed by the corporation. It primarily performs civil engineering activities with respect to construction projects. During the current year, Caddo Corporation earned $150,000 of taxable income. Caddo has not elected to be taxed under Subchapter S. What is Caddo’s current-year regular tax liability?
Answer:
$31,500
Explanation:
Since the Tax Cuts and Jobs Act of 2017 the corporate tax rate fell from 35% to a flat rate of 21% (current rate). Since we are not given any year, we can assume that this applies to 2018.
Caddo Corporation current tax liability = total taxable income x 21% = $150,000 x 21% = $31,500
The accounts receivable balance is $1,000,000. After adjustment, the allowance for uncollectible account balance is $40,000. Net Sales were $12,000,000. What is the net realizable value (book value) of the receivables?
Answer:
$960,000
Explanation:
The computation of the net realizable value (book value) of the receivable is shown below:
= Balance of accounts receivable - the balance of allowance for uncollectible account
= $1,000,000 - $40,000
= $960,000
Simply we deduct the balance of allowance for an uncollectible account from the Balance of accounts receivable so that the correct amount can come.
All other information which is given is not relevant. Hence, ignored it
What type of marketing uses a variety of forms to communicate directly with target customers to generate a response or transaction? see the attached file which has more questions
a) Public Relations
b) Publicity
c) Direct
d) Sales
e) Place
Answer:
C)Direct marketing is the correct answer.
Explanation:
The promotional method in which the information of company, product or survive is promoted directly to the customer without the use of advertising middleman is called direct marketing. In this method potential interest is presented to a consumer that is a likely buyer. Various of direct marketing are catalogues, fliers, Newsletters, phone calls etc. Although some marketing techniques aim to educate about company's products but the direct marketing aims to persuade people to take action, getting the sale is the ultimate goal.
Why are the adjustments important to the preparation of the financial statements? (Check all that apply.) Unadjusted financial statements could present a misleading and incomplete picture of the company's financial results. Unadjusted financial statements will always show net income because the expense accounts have not been brought up to date. Adjustments ensure that the revenues earned and expenses incurred during the period are reflected in the income statement. Adjustments ensure that the balance sheet reports all of the economic resources the company owns and all of the obligations the company owes. Confidence Level
Answer:
Unadjusted financial statements could present a misleading and incomplete picture of the company's financial results. Adjustments ensure that the revenues earned and expenses incurred during the period are reflected in the income statement. Adjustments ensure that the balance sheet reports all of the economic resources the company owns and all of the obligations the company owes.Explanation:
The balance sheet is not meant to show how a company works, it is rather a picture of how the company works. If your balance sheet is a picture of your house, you can see the different characteristics of your house and even get an idea of how good or bad the weather is. But presenting an unadjusted balance sheet is like taking a picture of the wrong house. That is exactly the reason why even though almost 100% of the businesses use software for accounting purposes, the IRS gives them a few months before presenting their balances because adjustments are necessary.
Think about the income statement and remember that revenue is recognized only when the company has significantly completed the revenue earning process. If the company sells a lot during the holiday season and a big portion is sold as accounts receivable. If you had to present an unadjusted income statement on January 2, you would have to estimate what percentage of your sales are not going to be collected or are going to be collected late. But if you have a couple of months to adjust your income statement then you will know for sure exactly how much was your revenue.
Adjustments are important in preparing financial statements as they provide an accurate and complete picture of a company's financial health and performance. They ensure that the company's revenues, expenses, assets, and liabilities are correctly reported, facilitating effective financial management and informed decision-making.
Explanation:Adjustments are crucial in the preparation of financial statements because they ensure accuracy and completeness in reporting the company's financial condition and operations. Without these adjustments, the financial statements may present a misleading and incomplete portrayal of the company's financial results. Specifically, unadjusted financial statements may not accurately represent revenues earned and expenses incurred during the accounting period.
For example, if an expense has been incurred but not yet paid or recorded, an unadjusted financial statement may show a higher net income than actual. Furthermore, adjustments ensure that the balance sheet reports all of the economic resources the company owns (assets) and all the obligations the company owes (liabilities). Consequently, adjustments provide a comprehensive and true view of a company's financial health and performance.
Similar to how you create a budget to manage your personal finances and prevent overdrafts or insufficient fund fees, a company also needs to make adjustments to manage its resources effectively. Hence, making timely and accurate adjustments is integral for sound financial management and making informed business decisions.
Learn more about Financial Statement Adjustments here:https://brainly.com/question/30973693
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Saffexo, a company that manufactures sports goods, hikes the prices of its entire range of athletic shoes. However, the company does not experience a fall in the sales of its shoes following the hike as the consumers continue to buy them. The information given in the scenario indicates that Saffexo has a good _____.
A. brand valuationB. product consistencyC. brand equityD. product mix
Answer: The correct answer is "C. brand equity".
Explanation: The information given in the scenario indicates that Saffexo has a good brand equity.
Because despite an increase in the price of their products people continue to opt for them, this means that for the quality of the product and the value of the brand consumers are willing to pay more for the product.
The rise of the "Cotton Kingdom" in the South led to all the following EXCEPT: large increase in the number of slaves. an insatiable demand for land to cultivate. increased dependence on banks for credit. Increased diversification of crops grown in the South.
Answer:
The answer is increased dependence on banks for credit.
Explanation:
Because the dependence on bankd only happened when the Cotton Kingdom failed and the slavery time was over. So the farmers were left with a huge amount of cotton, debts, no British to buy it. They could not afford the expenses of the equipment, the field, without the bank loans, because in this time, the would need to hire paid workers.
Maintaining a stable workforce working at a constant output rate while shortages and surpluses are absorbed by fluctuating inventory levels, order backlogs and allowing lost sales is which of the following production planning strategies?
A. Stable workforce, variable work hours
B. Chase
C. Level
D. Full employment
E. Skill maintenance
Answer: (C) Level production planning strategy
Explanation:
The level production planning is one of the type of strategy that is used for maintaining the steady rate of the production and also the level of the steady employment. This type of strategy helps for satisfying the demand of the customer.
The production planning strategy basically varying the inventory level for maintaining the production level in the given period of time. It is produced the constant output and also maintaining the stable work environment.
Therefore, Option (C) is correct.
The described production planning strategy is known as the Level production strategy, which keeps workforce and output constant while using inventory to buffer demand changes.
Explanation:The question pertains to the type of production planning strategy being described. Maintaining a stable workforce working at a constant output rate, while fluctuations in demand are buffered by changes in inventory levels, order backlogs, and the potential of lost sales, is referred to as the Level production strategy. This strategy focuses on keeping employment levels and output rates steady, protecting workers from the uncertainty of demand fluctuations, and relies on inventory adjustments to handle the ebb and flow of sales.
In several states, the state government has bid out the right to run the state's prison system to corporations and businesses.
Which of the three strategies of promoting reform is this an example of?
Answer:
Privatization of government entities to reduce bureaucracy
Explanation:
Many times government entities are not very efficient managers since the government is not interested in making a profit. So government owned companies tend to make little if any profit, and many times they suffer losses.
That is why some governments (both state and federal) decide to sell or privatize some government entities that are not properly or effectively managed and suffer heavy losses.
This is the case with state prisons, where private companies run them at a lower cost than when they were managed by government entities.
Describe what is meant by externalities.
Answer:
Externality is when the a third party not involved in production or consumption activities is impacted by these economic activities.
Externality is a form of market failure.
Externality could be postive or negative.
Positive externality - externality is positive when the benefits of economic activities to a third party exceeds its cost. An example am activity that generates positive externality is research and development. For example, research in the medical field has led to the discovery of cures to deadly diseases. The benefit of the research to the society exceeds its cost. Government can promote activities with positive externality by giving subsidies.
Negative externality is when the benefits of economic activities to a third party is less than its cost. An example of negative externality is pollution. A cigarette smoker is harming those around him. The cost to the people around him is more than its benefits. Government discourage activities that generates negative externality by taxation which makes prices higher. This type of tax is known as pigovian tax.
Explanation:
Carol wants to invest money in a 6% CD account that compounds semiannually. Carol would like the account to have a balance of $130,000 7-years from now. How much must Carol deposit to accomplish her goal?
Carol must deposit approximately $86,040.31 today into a 6% CD account compounded semiannually to have $130,000 in 7 years. The calculation involves rearranging the compound interest formula to solve for the present value, then substituting the given values to find the required initial deposit.
Finding the Present Value for a Compound Interest Account
To find out how much Carol needs to deposit today to reach her goal of $130,000 in 7 years with an interest rate of 6% compounded semiannually, we need to use the formula for the present value of a future amount in compound interest, which is:
A = P(1 + r/n)(nt)
Where:
A is the future value of the investment/loan, including interest.
P is the principal investment amount (the initial deposit or loan amount).
r is the annual interest rate (decimal).
n is the number of times that interest is compounded per year.
t is the time the money is invested or borrowed for, in years
In Carol's case, we have:
A = $130,000
r = 6% or 0.06 (as a decimal)
n = 2 (since the interest is compounded semiannually)
t = 7 year
Now, we can rearrange the formula to solve for P (the present value):
P = A / (1 + r/n)(nt)
Substituting the values we get:
P = $130,000 / (1 + 0.06/2)²ˣ⁷
P = $130,000 / (1 + 0.03)¹⁴
P = $130,000 / (1.03)¹⁴
P = $130,000 / 1.5103844462
P ≈ $86,040.31
Carol must deposit approximately $86,040.31 today to have a balance of $130,000 in a 6% CD account compounded semiannually after 7 years.
Day care for children is a competitive industry in long-run equilibrium at a price of $60 per day. In an effort to make day care more affordable for a larger number of families, the government passes a law that limits the amount day care providers can charge to $45 per day. As a result of this price ceiling, A. parents have a more difficult time finding day care providers for their children. B. the demand for day care increases and causes price to rise above the original $60 per day. C. the demand for day care increases and many new day care centers are established. D. the supply of day care services falls and causes price to fall below $45 per day.
Answer:
A. parents have a more difficult time finding day care providers for their children.
Explanation:
A price ceiling is usually set by the government or an agency of the government and it usually places a maximum amount on the prices that can be charged for a good or service.
When a price ceiling is set below equilibrium price, it usually discourages producers or suppliers who respond by reducing the quantity supplied.
Therefore, if a price ceiling is placed on day care, a lot of day care centres would close which would make it difficult for parents to find centres for their kids. Since a price ceiling is binding, prices would not increase.
I hope my answer helps you.
All the best
Setting a price ceiling of $45 on day care services below the equilibrium price of $60 creates a shortage, making option A the most likely outcome where parents struggle to find available providers.
When the government sets a price ceiling on day care services at $45 per day, which is below the long-run equilibrium price of $60 per day, this results in a shortage of day care services. Supply and demand analysis suggests that at this lower price, more parents will want day care services (since it is now more affordable), but fewer day care providers will be willing to offer their services at the lower price. This mismatch between higher demand and lower supply leads to a shortage.
Considering the options provided, the most likely and immediate outcome of instituting a price ceiling would be: A. parents have a more difficult time finding day care providers for their children. This is because the quantity of day care services demanded by parents will exceed the quantity supplied by providers at the price ceiling of $45, making it more challenging for parents to find available spots for their children.
If the principal decides to __________ the unauthorized agent's signature, the principal will then become liable for the instrument, while the agent will escape personal liability
Answer:
WORK THE unauthorized agent's signature
Explanation:
Janet and Julie work at ABC Interiors. Janet is a designer who works with clients of ABC on interior design projects. ABC closely supervises all of its designers, and dictates their work schedules. Julie works part-time in the evenings cleaning the offices.Refer to Fact Pattern 31-1. Janet is ABC’sa. employee, agent, and independent contractor.b. employee and agent.c. employee but not agent.d. independent contractor.
Answer:
c. employee but not agent
Explanation:
Agent(legal definition): a person whom act in the name of another yo enter contracts with third parties. Once perform, it is the principal (the party the agent represents) who assumes contracts obligation and benefits.
While an employee has a contract with an employer to provide his workforce. The law will assume someone employee if cannot be determinate otherwise.
In this case Janet works with clients but it do not signs contract with them. Also it is ABC which determinates their works schedules. An Agent has more liberty to search from potential client or from the list of client to negociate on his own and later offer a proposal to the principal.
This is not the case. As it cannot be proveen agent we assume is an employee of ABC
Kevin Chitry, a sales executive for CIT Manufacturing, frequently took clients out for dinner and shows when they came to town to tour the plant. He usually paid for these expenses himself and submitted the receipts to his supervisor for approval and reimbursement. Occasionally, however, he also took his family out to restaurants and rock concerts and included these expenses in his reimbursement requests by indicating that he was entertaining a client. This type of fraud is known as a(n):
Answer: Mischaracterized expense
Explanation:
Here, in this particular case we can state that this kind of fraud is referred to as a Mischaracterized expense. Mischaracterized expense are referred to as the situation under which an employee tends to attempts or try to receive the remuneration or rectification for the personal expense by further categorizing it as an organization expense.
Research and development costs:A. should be included in the cost of the patent they relate to.B. are capitalized and then amortized over a period not to exceed 20 years.C. are incurred as expenses only when R&D is successful.D. must be expensed when incurred under generally accepted accounting principles.
Answer:
D) must be expensed when incurred under generally accepted accounting principles.
Explanation:
Research and development costs are costs associated with developing new products or the discovery of new knowledge about scientific and technological goods and services.
Before 1974, R&D costs were capitalized as intangible assets, but then in 1974 the Financial Accounting Standards Board (FASB) ruled that companies must expense all R&D costs when incurred.
Research and development costs must be expensed when incurred under generally accepted accounting principles.
Explanation:Under generally accepted accounting principles, research and development costs must be expensed when incurred. These costs cannot be capitalized as an asset or included in the cost of the patent they relate to. Expensing R&D costs immediately allows companies to accurately reflect their expenses and financial position.
Many organizations use a(n) ____ interview to remind the employee of contractual obligations, such as nondisclosure agreements, and to obtain feedback on the employee’s tenure in the organization.
1. termination.
2. hostile.
3. departure.
4. exit.
Answer:
The correct answer is 4
Explanation:
Exit interview is a wrap-up interview or the meeting among the management representatives and the person or individual who is leaving a firm either voluntarily or through termination.
But it can be uses by the firm for remanding the employee of the contractual obligations of the person and also to attain the feedback on the tenure of the employee in the firm.
Sometimes those using the name multinational mean to imply that these companies have erased national allegiances, becoming itinerant firms that move investment and activity from nation to nation in search of profits.
True / False.
Answer: True
Explanation:
MNC is abbreviated as multinational corporation also referred to as the worldwide enterprise is known as the amalgamated organization which owns or has control over the production of commodities and services in an nation other than its domestic ground. A MNC can further be referred to as or known as the transnational enterprise or multinational enterprise.
Tech Surge applies research into physics and biochemistry to create advanced surgical instruments and implants. Its research department attracts some of the most talented professionals in these disciplines, each with a passion for his or her specialty. Next year, the position of vice president of research will be vacant, so the executive team is working with the HR department to define selection criteria for a new vice president. Given the company's structure, which quality will be important for the new vice president to possess?
Answer:
The future vice president needs to have not just one ability, but many. He should be a team player and a liaison that can combine the researchers' work and the company's strategic goals. He must also be a person that can tolerate failure, and instead of reproaching unsuccessful efforts, must be able to motivate his staff to keep trying.
The new vice president of research at Tech Surge should possess scientific expertise, leadership, interdisciplinary collaboration skills, managerial capabilities, strategic vision, and the ability to balance administrative tasks and research innovation.
In a company like Tech Surge, which applies research into physics and biochemistry to develop surgical instruments and implants, the new vice president of research should have a combination of scientific expertise and leadership skills. Given that the position is at the intersection of several specialized departments, the ability to foster interdisciplinary collaboration is essential.
The new vice president should also possess strong managerial capabilities to oversee the research and development process while enabling innovation and creativity within the team. Moreover, an understanding of product development and the ability to drive projects from the research phase to production would be critical.
Furthermore, considering the high-tech sector's emphasis on innovation and competition, the candidate should have strategic vision to guide worthwhile research investments that yield necessary and helpful outputs.
Lastly, having the finesse to navigate administrative matters without stifling the creativity of talented professionals is a necessary balance that promotes research productivity and innovation in a high-tech biotechnology environment.
You are going to form a partnership with an organization that sells domain names. What kind of organization is your partner?
Answer: The correct answer is : register
Explanation: The registrar is an accredited organization that sells domain names to the public, these domains are not yet owned by anyone or they can be registered. These companies also offer domain hosting. You can register a domain using Google Domains.
During the year an enterprise fund purchased $230,000 worth of equipment. The equipment was acquired with a cash down payment of $30,000 and a $200,000 loan. A partial year of depreciation on the equipment was taken in the amount of $23,000. What is the net effect of this transaction on the net position accounts of the enterprise fund?
Answer:
The net investment in capital assets is increased by $7,000.
Explanation:
Details amount amount
equipment $230,000
Partial year-depreciation ($23,000)
Net value of the equipment $207,000
acquired load ($200,000)
increase in capital assets $7,000
Therefore, The net effect of this transaction on the net position accounts of the enterprise fund is, The net investment in capital assets is increased by $7,000.
Sheffield Corp. prepared a 2019 budget for 105000 units of product. Actual production in 2019 was 115000 units. To be most useful, what amounts should a performance report for this company compare? The actual results for 115000 units with a new budget for 115000 units. The actual results for 115000 units with last year’s actual results for 118500 units. It doesn’t matter. All of these choices are equally useful. The actual results for 115000 units with the original budget for 105000 units.
Answer:
The actual results for 115000 units with a new budget for 115000 units.
Explanation:
In order to evaluate Sheffield's performance, you have to evaluate the actual production costs of producing 115,000 units compared to a new production budget for the same 115,000 units.
Budgets are stated in dollars, so if you compare this production level to a smaller production level then you might conclude that there was an unfavorable variance because more money than expected was spent, without considering that the total production had creased. If you compare this actual production to a budget for a larger production you might conclude that you underspent (had a favorable variance) without considering the fewer units produced.
Ogilvie Corp. issued 23,000 shares of no-par stock for $10 per share. Ogilvie was authorized to issue 46,000 shares. What effect will this event have on the company's financial statements?
Answer:
Oglivie Corp.'s assets (cash account) will increase be $230,000 and its equity (common stock account) will also increase by $230,000.
Every time a company issues stock and sells them, both its assets and equity have to increase in order to keep a balance in the balance sheet. Since Oglivie's stock are no-par, all of the money received should be included in the common stock account.
Jim has part ownership in a house. He has decided to sell his interest. He signs an agreement with a local real estate designated broker without informing the other two owners. Jim is most likely holding his part ownership as:_______
Answer:
joint tenant
Explanation:
Based on the information provided within the question it seems that Jim is most likely holding his part ownership as joint tenant. This is a unique type of ownership in which more than one individual share ownership of a property. These individuals share the exact same amount of rights to do with the property as they wish. Which is why Jim was able to sign away his part of the ownership without informing the other owners.
Mark Crane purchased a $1,000 corporate bond five years ago for $1,055. The bond paid 7.0 percent annual interest. Five years later, he sold the bond for $980. Calculate the total return for Mr. Crane’s bond investment. (Do not round intermediate calculations.)
Answer:
Mr Crane's total return on the bond investment was 5.35%
Explanation:
The return on a bond is also known as it yield to maturity (YTM). In order to find a bonds YTM we need to know its present value, future value, coupon payments and number of years. In this case the bond's present value is 1,055 because it was bought at this price, it's future value is 980 because it was sold for 980, its number of years was 5 as it was held for 5 years and its coupon payment was (0.07*1000)=70. Now in order to compute return or ytm we need to put all these values in a financial calculator and compute I
PV= -1055
FV= 980
PMT= 70
N=5
Compute I=5.35
The return on the bond investment was 5.35%
At the end of 2020, Oriole Co. has accounts receivable of $775,800 and an allowance for doubtful accounts of $71,100. On January 24, 2021, the company learns that its receivable from Megan Gray is not collectible, and management authorizes a write-off of $7,200. On March 4, 2021, Oriole Co. receives payment of $7,200 in full from Megan Gray. Prepare the journal entries to record this transaction.
Answer:
January 24, 2021 (write off)
Dr Allowance for Doubtful Accounts account 7,200
Cr Accounts Receivable account 7,200
March 4, 2021 (write off reversing)
Dr Accounts Receivable account 7.200
Cr Allowance for Doubtful Accounts account 7,200
March 4, 2021 (record collection)
Dr Cash account 7,200
Cr Accounts Receivable account 7,200
Final answer:
On January 24, 2021, Oriole Co. would write off Megan Gray's uncollectible account by debiting Allowance for Doubtful Accounts and crediting Accounts Receivable for $7,200. Upon receiving the payment on March 4, 2021, the company would reverse the write-off and then record the cash receipt.
Explanation:
When Oriole Co. writes off Megan Gray's uncollectible account, the journal entry on January 24, 2021, will involve debiting the Allowance for Doubtful Accounts and crediting Accounts Receivable. This action does not affect the total assets, as it is merely an adjustment within assets.
The journal entry on January 24, 2021 would be:
Debit Allowance for Doubtful Accounts $7,200
Credit Accounts Receivable $7,200
Upon receiving the unexpected payment from Megan Gray on March 4, 2021, Oriole Co. would reverse the previous write-off and then recognize the cash receipt. The journal entries would be:
Debit Accounts Receivable $7,200
Credit Allowance for Doubable Accounts $7,200
Followed by:
Debit Cash $7,200
Credit Accounts Receivable $7,200
This sequence makes sure the receivable is reinstated before the cash is recognized, allowing the books to reflect the actual transaction flow.