Journalize entries for recognizing accounts receivable . (LO 2) On January 6, Be
ID: 2504756 • Letter: J
Question
Journalize entries for recognizing accounts receivable.
(LO 2)
On January 6, Bennett Co. sells merchandise on account to Jackie Inc. for $7,000, terms 2/10, n/30. On January 16, Jackie Inc. pays the amount due. Prepare the entries on Bennett's books to record the sale and related collection.
On January 10, Connor Bybee uses his Sheridan Co. credit card to purchase merchandise from Sheridan Co. for $9,000. On February 10, Bybee is billed for the amount due of $9,000. On February 12, Bybee pays $6,000 on the balance due. On March 10, Bybee is billed for the amount due, including interest at 2% per month on the unpaid balance as of February 12. Prepare the entries on Sheridan Co.'s books related to the transactions that occurred on January 10, February 12, and March 10.
Journalize entries for recognizing accounts receivable.
(LO 2)
Presented below are two independent situations. (a)On January 6, Bennett Co. sells merchandise on account to Jackie Inc. for $7,000, terms 2/10, n/30. On January 16, Jackie Inc. pays the amount due. Prepare the entries on Bennett's books to record the sale and related collection.
(b)On January 10, Connor Bybee uses his Sheridan Co. credit card to purchase merchandise from Sheridan Co. for $9,000. On February 10, Bybee is billed for the amount due of $9,000. On February 12, Bybee pays $6,000 on the balance due. On March 10, Bybee is billed for the amount due, including interest at 2% per month on the unpaid balance as of February 12. Prepare the entries on Sheridan Co.'s books related to the transactions that occurred on January 10, February 12, and March 10.
Explanation / Answer
(a) Bennett Co. Debit Credit 1/6/2014 Accounts receivable 7,000 Sales 7,000 To record sale of merchandise 1/16/2014 Sales discounts ($7000 x .02) 140 Cash ($7000 x .98) 6,860 Accounts receivable 7,000 To record collection of accounts receivable (b) Sheridan Co. 1/10/2014 Accounts receivable 9,000 Sales 9,000 To record sale of merchandise 2/12/2014 Cash 6,000 Accounts receivable 6,000 To record Connor Bybee paid on account 3/10/2014 Interest receivable ($3000 x .02) 60 Interest income 60 To record accrued interest on Connor Bybee's account balance
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