Shared Flashcard Set

Details

Finacial Accounting
ACCU201 Chapter 6
15
Accounting
Undergraduate 2
10/31/2006

Additional Accounting Flashcards

 


 

Cards

Term
Net Sales
Definition
Sales revenue - sales returns and allowances - sales discounts - credit card discounts = net sales
Term
Journal Entry: store cc sales $3,000 w/ 3% cc service fee
Definition
debit: A/R - 2910, CC Discounts 90, credit: sales revenue - 3000
Term
journal entry: sale 1,000 on store credit, terms 2/10, n/30
Definition
debit: A/R-1000,
creit: sales revenue-1000
Term
journal entry: customer pays that purchase 6 days later in cash
Definition
debit: cash - 980, sales discount - 20,
credit: A/R - 1000
Term
journal entry: return for 500 on A/R
Definition
debit: sales returns and allowances 500,
credit: A/R 500
Term
gross profit percentage
Definition
= gross profit / net sales
Term
journal entry:
Gucci estimated bad debt expense for 2006 to be 3,000,000
Definition
Dec. 31 -
debit: bad debt expense 3000000
credit: ADA 3000000
Term
to adjust A/R... to amount business expects to collect
Definition
A/R - ADA = Net A/R
Term
journal entry:
Gucci's total write offs for 2006 were 1000000
Definition
Debit: ADA
Credit: A/R
Term
methods for extimating bad debts
Definition
percentage of credit sales, or againg of A/R
Term
percentage of credit sales
Definition
net credit sales * estimated uncollectable = amount of journal entry
Term
journal entry: estimated bad debts expense based on percentage of credit card sales of 100$
Definition
Dec 31:
Debit: Bad Debt Expense - 100
Credit: ADA - 100
Term
Aging of A/R
Definition
A/R * estimated uncollectable = desired balance in ADA
(- ADA credit balance + ADA debit balance) = amount of journal entry
Term
so if your estimate for uncollectible accounts is 100, and there is already a 10 credit balance in your ADA, then what is your adjusting entry?
Definition
100 desired bal - 10 credit bal = 90 adj entry
Dec 31:
Debit: Bad Debt Expense - 90
Credit: ADA - 90
Term
recievables turnover ratio
Definition
measures how many times avg A/R are recorded and collected in a year
Recievables turnover = net sales / avg net trade recievables
Supporting users have an ad free experience!