Problem 5-3A Record transactions related to accounts receivable (LO3, 5) [The fo
ID: 2460621 • Letter: P
Question
Problem 5-3A Record transactions related to accounts receivable (LO3, 5) [The following information applies to the questions displayed below The following events occur for The Underwood Corporation during 2015 and 2016, its first two years of operations. June 12, 2015 September 17, 2015 Receive $18,000 from customers on account. December 31, 2015 Estimate that 40% of accounts receivable at the end of the year will not be received. March 4, 2016 May 20, 2016 July 2, 2016 October 19, 2016 Receive $38,000 from customers for services provided in 2016. December 31, 2016 Estimate that 40% of accounts receivable at the end of the year will not be received. Provide services to customers on account for $32,600. Provide services to customers on account for $47,600. Receive $10,000 from customers for services provided in 2015. Write off the remaining amounts owed from services provided in 2015.Explanation / Answer
Date
General Journal
Debit
Credit
June 12 2015
Account Receivable A/c Dr
$32600
To Service Revenue A/c
$32600
Record Service Revenue
September 17, 2015
Cash/Bank A/c Dr
$18000
To Accounts Receivable A/c
$18000
To record Receipt from customers
December 31, 2015
Bad Debt Expenses A/c Dr
$5840
To Allowance for doubtful debts
$5840
To record bad debt expenses
March 4, 2016
Account Receivable A/c Dr
$47600
To Service Revenue A/c
$47600
To record service revenue
May 20, 2016
Cash/Bank A/c Dr
$10000
To Accounts Receivable A/c
$10000
To record collections from Receivables
July 2 2016
Allowance for Doubtful accounts
$4600
To Accounts receivables
$4600
To record Bad debts
Oct 19,2016
Cash/Bank A/c Dr
$38000
To Accounts Receivable A/c
$38000
To record collection from Receivables
December 31,2016
Bad Debt Expenses A/c Dr
$3840
To Allowance for doubtful debts
$3840
To record bad debts
3.
2015
2016
Total Accounts receivables
$32600
$47600
Less Received
$18000
$38000
Accounts Receivable Balance
$14600
$9600
Less Allowance for Bad Debts
$5840
$3840
Net Realizable Value
$8760
$5760
Net Realizable value= Accounts Receivable Balance-Allowance for bad debts
Date
General Journal
Debit
Credit
June 12 2015
Account Receivable A/c Dr
$32600
To Service Revenue A/c
$32600
Record Service Revenue
September 17, 2015
Cash/Bank A/c Dr
$18000
To Accounts Receivable A/c
$18000
To record Receipt from customers
December 31, 2015
Bad Debt Expenses A/c Dr
$5840
To Allowance for doubtful debts
$5840
To record bad debt expenses
March 4, 2016
Account Receivable A/c Dr
$47600
To Service Revenue A/c
$47600
To record service revenue
May 20, 2016
Cash/Bank A/c Dr
$10000
To Accounts Receivable A/c
$10000
To record collections from Receivables
July 2 2016
Allowance for Doubtful accounts
$4600
To Accounts receivables
$4600
To record Bad debts
Oct 19,2016
Cash/Bank A/c Dr
$38000
To Accounts Receivable A/c
$38000
To record collection from Receivables
December 31,2016
Bad Debt Expenses A/c Dr
$3840
To Allowance for doubtful debts
$3840
To record bad debts
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.