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The aging of accounts receivable involves classifying each account receivable by how long it is past its due date and estimating the percent of each uncollectible class.

A company had net sales of $21,500 and ending accounts receivable of $2,700 for the current period. Its days’ sales uncollected equals: (Use 365 days a year.)

On February 3, Smart Company sold merchandise in the amount of $5,800 to Truman Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,000. Smart uses the perpetual inventory system and the gross method. Truman pays the invoice on February 8, and takes the appropriate discount. The journal entry that Smart makes on February 8 is:

Franklin Company’s bank reconciliation as of August 31 is shown below.           Bank balance   $14,237 Book balance   $13,162 + Deposit in transit   4,500 Bank service fees   -50 – Outstanding checks   -3,900 Note collected   1,725 Adjusted bank balance   $14,837 Adjusted book balance   $14,837 The adjusting journal entries that Clayborn must record as a result of the bank reconciliation include:

The net method initially records the invoice at its net amount (net of any cash discount).

The Merchandise Inventory account balance at the beginning of the current period is equal to the amount of ending Merchandise Inventory from the previous period.

A Company had net sales of $23,000, and its average account receivables were $5,700. Its accounts receivable turnover is 0.24.

A debit balance in the Cash Over and Short account reflects an expense and is reported on the income statement as part of selling, general and administrative expenses.

Zenith Company’s Merchandise Inventory account at year-end has a balance of $91,820, but a physical count reveals that only $90,450 of inventory exists. The adjusting entry to record this $1,370 of inventory shrinkage is:

An analysis that explains differences between the checking account balance according to the depositor’s records and the balance reported on the bank statement is a(n):