Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

problem: The controller for Grant Corporation is concerned about certain business transactions that firm experienced during 2008. The controller, after discussing these matters with various individuals, has come to you for advice. The transactions at issue are presented below.

[A] The firm has decided to switch from the direct prepare-off method in accounting for bad debt expense to the percentage-of-sales approach. Suppose that Grant Corporation has recognized bad debt expense as the receivables have actually become uncollectible in the following way;

 

2007

2008

From 2007 sales

31,800

12,000

From 2008 sales

 

45,000

The controller estimates that an additional $65,400 will be charged off in 2009: $11,400 applicable to 2007 sales & $54,000 to 2008 sales.
[B] Inventory has been shipped on consignment. These transactions have been recorded as ordinary sales and billed as such on account. At December 31, 2008, inventory billed and in the hands of consignees amounted to $400,000. The percentage markup on selling price is 20%. Suppose that consigned inventory is sold the following year. The firm uses the perpetual inventory system. 
[C] During the current year, the firm sold $600,000 of goods on the installment basis. The cost of sales associated with these goods sold is $420,000. The firm inadvertently handled these sales and related costs as part of the regular sales transactions. Cash of $172,000, including a down payment of $60,000, was collected on these installment sales during the current year. Due to problemable, the installment method was considered appropriate.

Instructions;
[1] Suppose that Grant Corporation reported net income of $1,000,000 for 2008. Make a schedule showing the corrected net income after reviewing the above transactions.
[2] Make the journal entries necessary at December 31, 2008, suppose that the books have been closed.

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M922427

Have any Question? 


Related Questions in Accounting Basics

Guidelines for literature critiquesstudents are require to

Guidelines for Literature Critiques Students are require to read and understand assigned article. Students must submit a critique of assigned academic article. Please follow the format to complete your assignment. Detail ...

Transfer pricing is the pricing of assets funds services

Transfer pricing is the pricing of assets, funds, services, etc., transferred among related organizations. Using online library resources, and the Internet, conduct research to discuss the transfer pricing regulations an ...

What went wrongfriends bank is seeking to hire a new teller

What Went Wrong? Friend's Bank is seeking to hire a new teller. Darrell has applied for the position. His application states that five years ago, he was convicted for embezzlement as a teller. In the interview, Darrell r ...

Please see the list of stock from a virtual game that

Please see the list of stock from a virtual game that student invested during the period Sep 2016- Dec 2016. The returns are shown as well. Please use this information to write a report 2-4 pages about the project. Your ...

Accounting assignmentplease include all calculationswork

Accounting Assignment Please include all calculations/work necessary. Please show references and in-text citing where needed. Please answer all questions in full. No plagiarism. For the eActivity, research one publicly t ...

Assignmentthe company that i chose to research came to me

Assignment The company that I chose to research came to me on the way home from work this week while sitting in traffic. A string of several ads came on the radio and got a little frustrated that my Christmas tunes were ...

Write a 700- to 1050-word summary of the teams discussion

Write a 700- to 1,050-word summary of the team's discussion about IFRS versus GAAP, based on your team collaborative discussions. The summary should be structured in a subject-by-subject format. An introduction and a con ...

Question 1grammys bakery had the following information for

Question 1 Grammy's Bakery had the following information for the pay period ending June 30: Employee Name Pay Rate Hours Worked Cumulative Earnings Department Federal Income Tax Withheld P. Ganster $2,000 Salaried $12,00 ...

Assignment intermediate accountinginstructionsbulluse the

Assignment: Intermediate Accounting Instructions: • Use the answer sheet provided. • For the multiple choice answers, use upper case letters. • Only submit you answer sheet in the Assignment Folder NLT No late examinatio ...

1 what does it mean to create a culture of honesty openness

1. What does it mean to create a "Culture of Honesty, Openness, and Assistance?" Give some examples from an organization with which you have been affiliated. (250 words) 2. Review the section Preventing Fraud-A Sumary an ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro