Create a reserve for doubtful accounts of ½% of all gross sales for the period. It is decided to take into account as an additional expense chargeable to this period 1¼% of outstanding trade debtors for sales discounts that will probably still be taken advantage of.
Close Loss on Sale of Dynamo against Surplus.
Close Fire Loss and Strike Costs to Surplus.
In closing, bond discount is to be amortized on a straight line basis, i.e., ¹/₄₀ each half-year. Take account of accrued amortization for the two-month period since November 1.
The experimental laboratory has succeeded in securing a patent for a listing and adding device for use with the Knoxfraud, of much simpler operation and cheaper to manufacture, than the one on which royalty is being paid. Hence, when the royalty contract expires it will not be renewed. Capitalize the laboratory expense to date.
A very careful analysis of the advertising costs shows an expenditure of $78,445.25 above normal. It is decided to transfer this to Good-Will.
Claims for damage have been filed against the railways amounting to $1,025.10. (Bring this on to the books with an offsetting reserve of the same amount.)
A dividend of 12½% on the common is declared payable January 20, 1918.
Take into consideration the sinking fund requirements of the bond mortgage.
Instructions