Suppose that there were no allowance accounts and there was a straight write-off

Question

Suppose that there were no allowance accounts and there was a straight write-off, prepare journal entries to effect the write-off. A Small company maintains a petty cash fund of dollar3000.00 for small office expenditures. The following transactions occurred in 2012: Establish the Petty Cash fund: The Petty Cash is to be replenished at the end of the month. The amount of cash on hand dollar350. The following are the receipts: postage dollar1,000; office supplies dollar1,350; Delivery services dollar350. Prepare the journal entries needed for the replenishment of the fund:

Explanation / Answer

c) The journal entry for direct write off, when no allowance for doubtful debt account is maintained is:

Debit Bad Debt Expanse Acount

Credit Accounts receivable Account

3) A) Journal for establishment of petty cash fund:

Petty Cash...............................Dr. $3000

Cash.......................................................Dr. $3000

B) Cash excess and over = $350 + ($1000+$1350+$350) - $3000 = $50

Postage expenses.......................Dr. $1000

Office supplies expense...............Dr. $1350

Delivery expense.........................Dr. $350

Cash Excess and over......................................Cr. $50

Cash.......................................................... Cr. $ 2650

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