The following transactions, adjusting entries, and clsoing entries were complete
ID: 2448350 • Letter: T
Question
The following transactions, adjusting entries, and clsoing entries were completed by The AllStar Gallery during the current fiscal year ended December 31.
Feb.21 Reinstated teh account of Merryl Alber, which had been written off in the preceeding year as uncollectible. Journalized the reciept of $2,025 cash in full payment of Alber's account
March 31 Wrote off the $5,500 balance owned by Amos Co. which is bankrupt
July 7 Recieved 35% of the $8,000 balance owned by Morton Co. a bankrupt business and wrote off the remainder as uncollectable
August 29 Reinstated the account of Louis Sabo, which had been written off two years earlier as uncollectible, Recorded the receipt of $1,200 cash in full payment
December 31 Wrote off the following accounts as uncollectible (compound entry): Dailey Co. $10,050; Sun Co. $7,260; Zheng Furniture $3,775; Carey Wenzel $2,820
December 31 Based on an analysis of the $787,550 of accounts receivable, it was estimated that $32,500 will be uncollectible. Journalized the adjusting entry
December 31 Journalized the entry to close the appropriate account to Income Summary
Instructions
1. Record the Janurary 1 credit balance of $30,000 in Allowance for Doubtful Accounts
2. Journalize the transactions and the adjusting and closing entries. Post each entry that affects the following three selected accounts and deterine the new balances 115-Allowance for Doubtful Accounts 313-Income Summary 718-Uncollectible Accounts Expense
Explanation / Answer
1. Record the Janurary 1 credit balance of $30,000 in Allowance for Doubtful Accounts
2. Journalize the transactions and the adjusting and closing entries. Post each entry that affects the following three selected accounts and deterine the new balances 115-Allowance for Doubtful Accounts 313-Income Summary 718-Uncollectible Accounts Expense
New balances 115-Allowance for Doubtful Accounts = $ 32500
New balances 115-Income Summary = $- 33,880
Uncollectible Accounts Expense = $ 33,880
New Balance Allowance for Doubtful Accounts = 32500
Balance in Allowance for Doubtful Accounts before adjustment = 30000 + 2025 - 5500 - 5200 + 1200 -23905
Balance in Allowance for Doubtful Accounts before adjustment = - 1380
Uncollectible Accounts Expense = 32500 - (-1380)
Uncollectible Accounts Expense = 33880
Date Account Title & Explaination Debit Credit Janurary 1 Uncollectible Accounts Expense 30000 Allowance for Doubtful Accounts 30000Related Questions
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