The manda panda company uses the allowance method to account for bad debts. at the beginning of 2018, the allowance account had a credit balance of $92,400. credit sales for 2018 totaled $3,190,000 and the year-end accounts receivable balance was $507,500. during this year, $88,500 in receivables were determined to be uncollectible. manda panda anticipates that 3% of all credit sales will ultimately become uncollectible. the fiscal year ends on december 31. required: 1. does this situation describe a loss contingency? 2. what is the bad debt expense that manda panda should report in its 2018 income statement? 3. prepare the appropriate journal entry to record the contingency. 4. complete the table below to calculate the net realizable value manda panda should report in its 2018 balance sheet?

1. Does this situation describe a loss contingency?

Yes, the situation reflect the necessity of report a loss contingency because the it's needed to cover the 3% of Allowance for Uncollectible Accounts

2. What is the bad debt expense that Manda Panda should report in its 2018 income statement? $11.325

3. Prepare the appropriate journal entry to record the contingency.

Please see explanation section.

4. Complete the table below to calculate the net realizable value Manda Panda should report in its 2018 balance sheet?

Explanation:

The entry to reflect the bad expenses of the contingency:

Bad debt expense $ 11.325  

Allowance for Uncollectible Accounts   $ 11.325

Net Realizable Value is:

Accounts Receivable $ 507.500  

Allowance for Uncollectible Accounts  $ 15.225

Net Realizable Value  $ 492.275  

Initial Balance    

Accounts Receivable  $ 507.500  End 2018

Allowance for Uncollectible Accounts  - $ 92.400Beginning 2018

Entry when $88,500 in receivables were determined to be uncollectible.  

Allowance for Uncollectible Accounts  $ 88.500  

Accounts Receivable  $ 88.500

(Keep in mind that the balance of Acc Rec is at the end of 2018, so this entry had already been registered.)

New Balance    

Accounts Receivable  $ 507.500  End 2018

Allowance for Uncollectible Accounts  $ 3.900End 2018

Bad debt expense  $ 11.325  to complete the 3%

Allowance for Uncollectible Accounts  $ 11.325  

New Balance    

Accounts Receivable  $ 507.500  

Allowance for Uncollectible Accounts  $ 15.2253%

Net Realizable Value  $ 492.275  

being born in poverty would limit the people's chances, opportunities and benefits.

this happen because of several things, such as:

- poor people tend to gain less access to good education and nutrition. this mean that their chance to obtain high paying jobs would also be limited.

- poor people tend to socialize with other poor people while the rich tend to socialize with other rich people. this means that simply throguh their social circle, rich people would have more business opportunities compared to the poor people.

- rich people tend to have more capital in their disposal. this would benefit them in business since it is far easier for them to fund their business operation compared to poor people.

two years ago, when picking flowers in the mountains back of yosemite valley, i found a book. it was blotted and storm-beaten; all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however; many of the inner pages were well preserved. and although all were more or less stained and torn, whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today; its granite pages have been torn and blurred by the same storms that wasted the castaway book.

two years ago, when picking flowers in the mountains back of yosemite valley; i found a book. it was blotted and storm-beaten, all of its outer pages were mealy and crumbly. the paper seemed to dissolve like the snow beneath which it had been buried, however, many of the inner pages were well preserved. and although all were more or less stained and torn; whole chapters were easily readable. this is the condition of the great open book of yosemite glaciers today, its granite pages have been torn and blurred by the same storms that wasted the castaway book.