Master Business with Fun Quizzes & Brain Teasers!
E8-7 (algo) computing bad debt expense using aging of accounts receivable method [lo 8-2] brown cow dairy uses the aging approach to estimate bad debt expense. the balance of each account receivable is aged on the basis of three time periods as follows: (1) 1 to 30 days old, $12,900; (2) 31 to 90 days old, $5,900; and (3) more than 90 days old, $3,900. for each age group, the average loss rate on the amount of the receivable due to uncollectibility is estimated to be (1) 5 percent, (2) 10 percent, and (3) 15 percent, respectively. at december 31 (end of the current year), the allowance for doubtful accounts balance was $890 (credit) before the end-of-period adjusting entry is made. required: prepare a schedule to estimate an appropriate year-end balance for the allowance for doubtful accounts. what amount of bad debt expense should be recorded on december 31
Using these data from the comparative balance sheet of Blossom Company, perform vertical analysis. (Round percentages to 1 decimal place, e. G. 12. 5%. ) Dec. 31, 2020 Dec. 31, 2019 Amount Percentage Amount Percentage Accounts receivable $497,000 % $435,000 % Inventory 735,000 % 555,000 % Total assets 3,101,000 % 2,758,000 %
Robertson Resorts is considering whether to expand their Pagosa Springs Lodge. The expansion will create 24 additional rooms for rent. The following estimates are available:Cost of expansion$3,310,000 Discount rate 9%Useful life 20 Annual rental income$1,900,000 Annual operating expenses$1,450,000 Robertson uses straight-line depreciation and the lodge expansion will have a residual value of $2,520,000. Required:1. Calculate the annual net operating income from the expansion. 2. Calculate the annual net cash inflow from the expansion. 3. Calculate the ARR. (Round your answer to 2 decimal places. )4. Calculate the payback period. (Round your answer to 1 decimal place. )5. Calculate the NPV. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1. ) (Use appropriate factor(s) from the tables provided. Do not round intermediate calculations. Round your final answer to nearest whole dollar amount. )
Carmichael Cleaners needs a new steam finishing machine that costs $100,000. The company is evaluating whether it should lease or purchase the machine. The equipment falls into the MACRS 3-year class, and it would be used for 3 years and then sold, because the firm plans to move to a new facility at that time. The estimated value of the equipment after 3 years is $30,000. A maintenance contract on the equipment would cost $3,000 per year, payable at the beginning of each year. Alternatively, the firm could lease the equipment for 3 years for a lease payment of $29,000 per year, payable at the beginning of each year. The lease would include maintenance. Due to special circumstances, the firm is in the 20% tax bracket, and it could obtain a 3-year simple interest loan, interest payable at the end of the year, to purchase the equipment at a before-tax cost of 10%. If there is a positive Net Advantage to Leasing the firm will lease the equipment. Otherwise, it will buy it. What is the NAL? (Note: Assume MACRS rates for Years 1 to 4 are 0. 3333, 0. 4445, 0. 1481, and 0. 741. )