Exercise 8-3 At the beginning of the current period, Skysong, Inc. had balances

Question

Exercise 8-3

At the beginning of the current period, Skysong, Inc. had balances in Accounts Receivable of $197,000 and in Allowance for Doubtful Accounts of $9,040 (credit). During the period, it had net credit sales of $862,700 and collections of $838,670. It wrote off as uncollectible accounts receivable of $7,477. However, a $3,049 account previously written off as uncollectible was recovered before the end of the current period. Uncollectible accounts are estimated to total $26,310 at the end of the period. (Omit cost of goods sold entries.)

No.

Account Titles and Explanation

Debit

Credit

(To record sales)

(To reinstate account previously written off)

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LINK TO TEXT

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Exercise 8-3

At the beginning of the current period, Skysong, Inc. had balances in Accounts Receivable of $197,000 and in Allowance for Doubtful Accounts of $9,040 (credit). During the period, it had net credit sales of $862,700 and collections of $838,670. It wrote off as uncollectible accounts receivable of $7,477. However, a $3,049 account previously written off as uncollectible was recovered before the end of the current period. Uncollectible accounts are estimated to total $26,310 at the end of the period. (Omit cost of goods sold entries.)

Exercise 8-3 At the beginning of the current period, Skysong, Inc. had balances in Accounts Receivoble of $197,000 and in Allowance for Doubtful Accounts of $9,040 (credit). During the period, i had net credit sales of $862,700 and collections of $938,670. It wrote off as ncollectible accounts receivable of s7,477. However, a$3,049 account previously written off as uncollectible was recovered before the end of the current period. Uncollectible accounts are estimated to total $26,310 at the end of the period. (Omit cost of goods sold (a) Prepare the entries to record sales and collections during the pariod (b) Prepare the entry to record the write-off of uncollectible accounts during the period. (c) Prepare the entries to record the recovery of the uncollectible account during the period, (d) Prepare the entry to record bad debt expense for the period (Credit account titles are automatically indented when amount is entered. Do not indent manually.) No. Account Tities and Explanation Debit Credit To record sales) To reinstate account previously written off) LINK TO TEXT LINK TO TEXT Determine the ending balances in Accounts Receivable and Allowance for Doubtful Accounts. Ending balance in Accounts Receivable Ending balance in Alowance for Doubtful Accounts

Explanation / Answer

Journal entry :

Determine the ending balances in Accounts Receivable and Allowance for Doubtful Accounts.

Ending balance of account receivable = 213553

Ending balance of allowance for doubtful accounts = 26310

Net realizable value = (213553-26310) = 187243

No Accounts & explanation debit credit a) Account receivable 862700     Sales revenue 862700 Cash 838670     Account receivable 838670 b) Allowance for doubtful accounts 7477     Account receivable 7477 c) Account receivable 3049      Allowance for doubtful accounts 3049 (To reinstate account previously written off) Cash 3049     Account receivable 3049 d) Bad debt expense 21698      Allowance for doubtful accounts 21698

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