3. During th current Year Bob\'s Ceramics Shop had sales revenue of $180 000 of

Question

3. During th current Year Bob's Ceramics Shop had sales revenue of $180 000 of which $74.000 was on cre it. A he s t of he current year, Accounts Receivable showed ? S2600 debit ba nce, and the Allowance or Doub ul Accounts showed 1,000 credit balance. Colections of accounts receivable during the current year aiounied to $59,000. Dela during lhe current year follows. a. On Deoernber 31 an Account Receivable (Toby's Gifl Shp)f S1,700 from a prior year was deterrrined to be uncollectible, herefore, it was wriler oll iiiedialely as a bad debl ? on December 31 on the basis of €xperience, a decision was rre de o continue he a oun lng po cy or bas?ng estimated bad debt losses on 2.0 percent of ?edit sales for he year. Required: 1. Propare the roquircd jcurnal entries for the two items on Dccomber 31, end of the accounting pericd. (If no entry is required for a transactionievent, select "No journal entry required in the first account field.) View transaction list Journal entry worksheet On December 31, an Account Receivable (Toby's Gift shop) of S1,700 from a prior year was determined to be uncollectible; therefore, it was written off immediately as a bad debt. Notc: Enter dabits before aredts. Date Debit Credit Deccmber 31 Alowancc for doubtiul acccunts 1,700 Accounts receivable (Toby's Git Shop)

Explanation / Answer

Answer 1. Journal Entry S. No. Date Particulars Dr. Amt. Cr. Amt. a. 31-Dec Allowance for Doubtful Accounts    1,700.00    Accounts Receivable    1,700.00 (To Record the accounts recivable (Toby Gift Shop) written off) b. 31-Dec Bad Debts Expenses    2,180.00    Allowance for Doubtful Accounts    2,180.00 (To record the bad debt expenses) Allowance for Doubtful Accounts Beg. Bal.      1,000.00 A/R - Written off      1,700.00      2,180.00 Bad Debts (Bal. fig.) End Bal.      1,480.00 Allowance for Doubtful Accounts - ending Balance = $74,000 X 2% Allowance for Doubtful Accounts - ending Balance = $1,480 Answer 2. BOB'S CERAMICS SHOP Partial Income Statement For the Year Ended Dec 31 Operating Expense Bad Debts Expenses      2,180.00 BOB'S CERAMICS SHOP Partial Balance Sheet As of Dec 31 Current Assets Accounts Receivable    39,300.00 Allowance For Doubtful Accounts    (1,480.00) Accounts Receivable, Net    37,820.00 Accounts Receivable Beg. Bal.    26,000.00    59,000.00 Cash Recd. Sales (Credit)    74,000.00      1,700.00 A/R - Written off End. Bal.    39,300.00

Related Questions

Navigate

• Browse (All)
• Browse 3
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.