Journal Entries for Credit Losses ournal Entries for Credit Losses At January 1,
ID: 2573353 • Letter: J
Question
Journal Entries for Credit Losses
ournal Entries for Credit Losses At January 1, the Griffin Company had the following accounts on its books: Accounts Receivable Allowance for Doubtful Accounts $7,100 Credit $129,000 Debit During the year, credit sales were: $841,000 and collections on account were: $824,000 The following transactions, among others, occurred during the year: Jan.11 Wrote off J. Wolf's account, Apr.29 Wrote off B. Avery's account Nov.15 Received $1,300 from B. Avery, to pay a debt that had been written off on $3,100 $1,300 April 29, in final settlement of the account written off on April 29. This amount is not included in the $824,000 collections. Wrote off D. Wright's account, In an adjusting entry, recorded the allowance for doubtful accounts at of credit sales for the year Dec.05 $2,450 Dec.31 1.1% Required a. Prepare the journal entries to record the credit sales, the collections on account, the transactions and the adjustment. b. Show how Accounts Receivable (including the credit balances) and the Allowance for Doubtful Accounts appear on the December 31 balance sheet.Explanation / Answer
a)
b)
31-Dec Accounts receivable $ 841,000 Sales $ 841,000 (To record credit sales) 31-Dec Cash $ 824,000 Accounts receivable $ 824,000 (To record cash collection) Jan-11 Allowance for doubtful accounts $ 3,100 Accounts receivable $ 3,100 (To record write off of Wolf's account) Apr-29 Allowance for doubtful accounts $ 1,300 Accounts receivable $ 1,300 (To record write off of Avery's account) Nov-15 Accounts receivable $ 1,300 Allowance for doubtful accounts $ 1,300 (To record reversal of write off of Avery's account) Cash $ 1,300 Accounts receivable $ 1,300 Dec-05 Allowance for doubtful accounts $ 2,450 Accounts receivable $ 2,450 Dec-31 Baddebt expenses ($841,000*1.1%) $ 9,251 Allowance for doubtful accounts $ 9,251Related Questions
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