Exercise 8-3 (Part Level Submission) At the beginning of the current period, Wat

Question

Exercise 8-3 (Part Level Submission) At the beginning of the current period, Waterway Industries had balances in Accounts Receivable of $190,800 and in Allowance for Doubtful Accounts of $9,670 (credit). During the period, it had net credit sales of $730,800 and collections of $749,620. It wrote off as uncollectible accounts recelvable of $7,511. However, a $3,339 account previously written off as uncollectible was recovered before the end of the current period Uncollectible accounts are estimated to total $23,000 at the end of the period. (Omit cost of goods sold entries.) (a-d (a) Prepare the entries to record sales and collections during the period. Prepare the entries to record the recovery of the uncollectible account during the period. 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 Titles and Explanation Debit Credit To record sales) To reinstate account previously written off)

Explanation / Answer

Answer

S No.

Debit

Credit

a

Accounts Receivable

           730,800

Sales Revenue

           730,800

(To Record Sales)

Cash

           749,620

Accounts Receivable

           749,620

(To record cash received)

b

Allowance for Doubtful Accounts

                7,511

Accounts Receivable

                7,511

c

Accounts Receivable

                3,339

Allowance for Doubtful Accounts

                3,339

(To reinstate account previously written off)

Cash

                3,339

Accounts Receivable

                3,339

d

Bad debt expense (7,511 - 3,339)

                4,172

Allowance for Doubtful Accounts

                4,172

S No.

Debit

Credit

a

Accounts Receivable

           730,800

Sales Revenue

           730,800

(To Record Sales)

Cash

           749,620

Accounts Receivable

           749,620

(To record cash received)

b

Allowance for Doubtful Accounts

                7,511

Accounts Receivable

                7,511

c

Accounts Receivable

                3,339

Allowance for Doubtful Accounts

                3,339

(To reinstate account previously written off)

Cash

                3,339

Accounts Receivable

                3,339

d

Bad debt expense (7,511 - 3,339)

                4,172

Allowance for Doubtful Accounts

                4,172

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