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5. Bargain Wholesalers sells pet supplies to retailers including Pet World Supplies. Bargain Wholesalers uses a perpetual inventory. Journalize the following transactions: May 4 Bargain Wholesalers sells inventory to Pet World Supplies for $8,250 with terms 1/10, n/30. The cost of the merchandise is $5,755. 7 Bargain Wholesalers sells an additional $10,985 in inventory to Pet World Supplies with terms 1/10, n/30. The cost of the merchandise is $6,925. 13 Bargain Wholesalers receives a check from Pet World Supplies paying the balance due on both invoices.

5. Bargain Wholesalers sells pet supplies to retailers including Pet World Supplies. Bargain Wholesalers uses a perpetual inventory. Journalize the following transactions: May 4 Bargain Wholesalers sells inventory to Pet World Supplies for $8,250 with terms 1/10, n/30. The cost of the merchandise is $5,755. 7 Bargain Wholesalers sells an additional $10,985 in inventory to Pet World Supplies with terms 1/10, n/30. The cost of the merchandise is $6,925. 13 Bargain Wholesalers receives a check from Pet World Supplies paying the balance due on both invoices.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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5. Bargain Wholesalers sells pet supplies to retailers including Pet World Supplies. Bargain Wholesalers uses a perpetual inventory. Journalize the following transactions: May 4 Bargain Wholesalers sells inventory to Pet World Supplies for $8,250 with terms 1/10, n/30. The cost of the merchandise is $5,755. 7 Bargain Wholesalers sells an additional $10,985 in inventory to Pet World Supplies with terms 1/10, n/30. The cost of the merchandise is $6,925. 13 Bargain Wholesalers receives a check from Pet World Supplies paying the balance due on both invoices. Journal Date Description Debit Credit
Transcribed Image Text:5. Bargain Wholesalers sells pet supplies to retailers including Pet World Supplies. Bargain Wholesalers uses a perpetual inventory. Journalize the following transactions: May 4 Bargain Wholesalers sells inventory to Pet World Supplies for $8,250 with terms 1/10, n/30. The cost of the merchandise is $5,755. 7 Bargain Wholesalers sells an additional $10,985 in inventory to Pet World Supplies with terms 1/10, n/30. The cost of the merchandise is $6,925. 13 Bargain Wholesalers receives a check from Pet World Supplies paying the balance due on both invoices. Journal Date Description Debit Credit
6. For a business that uses the allowance method of accounting for uncollectible receivables: (a) Journalize the entries to record the following: (1) Record the adjusting entry at December 31, the end of the first fiscal year, to record the bad debt expense. The accounts receivable account has a balance of $800,000, and the contra asset account before adjustment has a debit balance of $600. Analysis of the receivables indicates uncollectible receivables of $18,000. (2) In March of the next year, the $350 owed by Fronk Co. on account is written off as uncollectible. (3) In November of the next year, $200 of the Fronk Co. account is reinstated and pay- ment of that amount is received. (4) In December of the next year, $400 is received on the $600 owed by Dodger Co. and the remainder is written off as uncollectible.
Transcribed Image Text:6. For a business that uses the allowance method of accounting for uncollectible receivables: (a) Journalize the entries to record the following: (1) Record the adjusting entry at December 31, the end of the first fiscal year, to record the bad debt expense. The accounts receivable account has a balance of $800,000, and the contra asset account before adjustment has a debit balance of $600. Analysis of the receivables indicates uncollectible receivables of $18,000. (2) In March of the next year, the $350 owed by Fronk Co. on account is written off as uncollectible. (3) In November of the next year, $200 of the Fronk Co. account is reinstated and pay- ment of that amount is received. (4) In December of the next year, $400 is received on the $600 owed by Dodger Co. and the remainder is written off as uncollectible.
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