Lopez Company began operations on January 1, 2014. Duing Its ilst iWo years, the

Question

Lopez Company began operations on January 1, 2014. Duing Its ilst iWo years, the company completed a number of transactions involving sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows. 2014 a. Sold $1,345,000 of merchandise (that had cost $978,200) on credit, terms n/30. b. Wrote of $20,100 of uncollectible accounts receivable. c. Received $670,500 cash in payment of accounts receivable d. In adjusting the accounts on December 31, the company estimated that 210% of accounts receivable will be uncollectible. 2015 e. Sold $1,558,500 of merchandise (hat had cost $1,281,000) on credit, terms n/30. 1. Wrote of $31,600 of uncollectible accounts receivable. g. Received $1,268,600 cash in payment of accounts receivable h. In adjusting the accounts on December 31, the company estimated that 210% of accounts receivable will be uncollectible. Required: Prepare journal entries to record Lopez's 2014 and 2015 summarized transactions and its year-end adjustments to record bad debts expense. (The company uses the perpetual inventory system.) (Round your intermediate calculations and final answers to the nearest dollar amount. Omit the "$" sign in your response.) 2014 General Journal Debit Credit a (Click to select) (Click to select) (Click to select) (Click to select) b. Click to select) (Click to select) c (Click to select) (Click to select) d. (Click to select) Click to select) General J Click to select)

Explanation / Answer

Date

Accounts Title & Explanation

Debit

Credit

2014

(a).

Accounts receivable

$1345000

     Sales

$1345000

(For recording amount of credit sales)

Cost of goods sold

$978200

     Mercandise inventory

$978200

(For recording cost of mercandise sold)

(b).

Allowance for doubtful accounts

$20100

     Accounts receivable

$20100

(For recording uncollectible accounts receivables)

(c).

Cash

$670500

     Accounts receivables

$670500

(For recording receipts of cash from accounts receivables)

(d).

Bad debts expesnes ($1345000 - $20100 - $670500) * 2.10% + $20100

$33842

     Allowance for doubtful accounts

$33842

(For recording 2.10% of accounts receivables as uncollectible)

2015

(e).

Accounts receivable

$1558500

     Sales

1558500

(For recording amount of credit sales)

Cost of goods sold

$1281000

     Mercandise inventory

$1281000

(For recording cost of mercandise sold)

(f).

Allowance for doubtful accounts

$31600

     Accounts receivable

$31600

(For recording uncollectible accounts receivables)

(g).

Cash

$1268600

     Accounts receivables

$1268600

(For recording receipts of cash from accounts receivables)

(h).

Bad debts expesnes ($1558500 - $31600 - $1268600) * 2.10% + $31600

$37024

     Allowance for doubtful accounts

$37024

(For recording 2.10% of accounts receivables as uncollectible)

Date

Accounts Title & Explanation

Debit

Credit

2014

(a).

Accounts receivable

$1345000

     Sales

$1345000

(For recording amount of credit sales)

Cost of goods sold

$978200

     Mercandise inventory

$978200

(For recording cost of mercandise sold)

(b).

Allowance for doubtful accounts

$20100

     Accounts receivable

$20100

(For recording uncollectible accounts receivables)

(c).

Cash

$670500

     Accounts receivables

$670500

(For recording receipts of cash from accounts receivables)

(d).

Bad debts expesnes ($1345000 - $20100 - $670500) * 2.10% + $20100

$33842

     Allowance for doubtful accounts

$33842

(For recording 2.10% of accounts receivables as uncollectible)

2015

(e).

Accounts receivable

$1558500

     Sales

1558500

(For recording amount of credit sales)

Cost of goods sold

$1281000

     Mercandise inventory

$1281000

(For recording cost of mercandise sold)

(f).

Allowance for doubtful accounts

$31600

     Accounts receivable

$31600

(For recording uncollectible accounts receivables)

(g).

Cash

$1268600

     Accounts receivables

$1268600

(For recording receipts of cash from accounts receivables)

(h).

Bad debts expesnes ($1558500 - $31600 - $1268600) * 2.10% + $31600

$37024

     Allowance for doubtful accounts

$37024

(For recording 2.10% of accounts receivables as uncollectible)

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