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If Puddle Incorporated had total Accounts Receivable at the end of 2019 of $630 million and an allowance for uncollectible accounts of $16 million show the effect of the following in the accounting equation worksheet for 2020:a. Calculate how much customers actually owe to Puddle at the end of 2020.b. Calculate how much is estimated will not be collected by Puddle at the end of 2020.c. State how much expenses increased due to the estimate of uncollectible accounts.d. How much would Puddle show as the amount they actually plan to collect (Accounts Receivable, Net)

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anthougo

a. The amount (Accounts Receivable) that customers actually owe Puddle Incorporated at the end of 2020 is $741 million.

b. At the end of 2020, it is estimated that Puddle Incorporated will not collect (Allowance for Uncollectible Accounts) $22.23 million.

c. Bad Debt Expenses increased to $20.23 million.

d. The amount that Puddle Incorporated will show as the amount that they actually plan to collect (that is the Accounts Receivable, Net) is $718.77 million.

Data and Calculations:

Sales on credit in 2020 = $4,315 million

Collections during 2020 = $4,190 million

Uncollectible accounts written off during 2020 =$14 million

  • Allowance for uncollectible accounts = 3% of total accounts receivable

= $22.23 million ($741 million x 3%)

  • The following T-Accounts are used to calculate the requirements for a), b), and c) and the amounts are in millions.

Accounts Receivable

Account Titles                  Debit      Credit

Beginning balance          $630

Sales Revenue                4,315

Cash                                                $4,190

Allowance for Uncollectible                   14

Ending balance                                 $741

Allowance for Uncollectible Accounts

Account Titles                  Debit      Credit

Beginning balance                            $16

Accounts Receivable       $14

Bad Debts Expense                        $20.23

Ending balance                $22.23

Bad Debts Expense

Account Titles                            Debit      Credit

Allowance for Uncollectibles $20.23

  • Accounts Receivable, Net

Accounts Receivable ending balance $741

Allowance for Uncollectible accounts   (22.23)

Amount planned to collect                $718.77

Thus, Puddle Incorporated plans to collect $718.77 million in 2021 from past sales to customers but may collect more or less.

Learn more about Allowance for Uncollectible Accounts at https://brainly.com/question/17350161

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