The following transactions were completed by The Irvine Company during the curre
ID: 2583729 • Letter: T
Question
The following transactions were completed by The Irvine Company during the current fiscal year ended December 31: Feb. 8 Received 45% of the $18,700 balance owed by DeCoy Co., a bankrupt business, and wrote off the remainder as uncollectible. May 27 Reinstated the account of Seth Nelsen, which had been written off in the preceding year as uncollectible. Journalized the receipt of $7,270 cash in full payment of Seth’s account. Aug. 13 Wrote off the $6,360 balance owed by Kat Tracks Co., which has no assets. Oct. 31 Reinstated the account of Crawford Co., which had been written off in the preceding year as uncollectible. Journalized the receipt of $3,975 cash in full payment of the account. Dec. 31 Wrote off the following accounts as uncollectible (compound entry): Newbauer Co., $7,265; Bonneville Co., $5,595; Crow Distributors, $9,305; Fiber Optics, $1,150. Dec. 31 Based on an analysis of the $1,759,500 of accounts receivable, it was estimated that $35,190 will be uncollectible. Journalized the adjusting entry.
Explanation / Answer
Feb-08 Cash 8415 Allowance for Doubtful Accounts 10285 Accounts Receivable-DeCoy Co. 18700 May-27 Accounts Receivable-Seth Nelsen 7270 Allowance for Doubtful Accounts 7270 May-27 Cash 7270 Accounts Receivable-Seth Nelsen 7270 Aug-13 Allowance for Doubtful Accounts 6360 Accounts Receivable-Kat Tracks Co. 6360 Oct-31 Accounts Receivable-Crawford Co. 3975 Allowance for Doubtful Accounts 3975 Oct-31 Cash 3975 Accounts Receivable-Crawford Co. 3975 Dec-31 Allowance for Doubtful Accounts 23315 Accounts Receivable-Newbauer Co. 7265 Accounts Receivable-Bonneville Co. 5595 Accounts Receivable-Crow Distributors 9305 Accounts Receivable-Fiber Optics 1150 Dec-31 Bad Debt Expense 35190 Allowance for Doubtful Accounts 35190
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