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Receivables Assignment

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Scenario;You are the Accountant for WanneBee Corporation;WannaBee Corporation has $1,500,000 of Receivables on December 31, 2000. WannaBee uses the Allowance Method and historical data indicates that 7% of receivables become uncollectible. The end of year balance in the ADA is 0.;The following are the 2000 end of year receivables.;AR- Goodboy $25,000 AR-NannyNancy $250,000;AR-BusyBody $75,000 AR-AlphaBetCo $130,000;AR-DippyDo $55,000 AR-TipsyTurvy $98,000;AR-MerryMen $145,000 AR-HappyHart $289,000;AR-CurlyCues $211,000 AR-MityMan $47,000;AR-PrettyPenny $109,000 AR-JumpingJax $66,000;During 2001 the following events occurred;Goodboy defaulted.;BusyBody declared bankruptcy but paid $19,000.;DippyDo paid the account in full.;MerryMen still owes $48,000.;CurlyCues has not answered the phone for 8 months.;PrettyPenny paid its account.;NannyNancy paid $150,000 and on November 21 made a 120 note at 4% APR for the remainder.;AlphaBetCo paid its account in full.;TipsyTurvy has closed its business.;HappyHart paid its bill.;MityMan still owes its account.;JumpingJax paid ? its bill and will not pay the rest.;The Receivables balance at the end of the year is $2,235,000;Assignments;(1) Prepare the Required AJE for December 31, 2000.;(2) Prepare the Required AJE for December 31, 2001.

 

Paper#76977 | Written in 18-Jul-2015

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