a) Prepare all journal entries to record the activity for the items above for 2020b) Prepare any journal entries required at December 31, 2020 to record bad debt expense for the year Growing Crystals Corp. has provided the following information relating to its sales for the past year,which ended December 31, 2020. The company uses the balance sheet (accounts receivable) method ofaccounting for bad debt expense.Estimated % of accounts receivable that will be uncollectable5%Jan. 1, 2020, balance in the allowance for doubtful account$2,000 cr(this is before any adjusting entries)Jan. 1, 2020, balance in the accounts receivable account$40,000 drCredit sales (2020)$650,000Write offs of uncollectible accounts receivable (2020)$6,200Collections of previously written off amounts (2020)$900Cash received in payment of accounts receivable (2020)$570,000

Account receivable means the amount due from customer whom we sold the goods on credit. Allowance…

Answered: a) Prepare all journal entries to…

a) Prepare all journal entries to record the activity for the items above for 2020 b) Prepare any journal entries required at December 31, 2020 to record bad debt expense for the year

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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Question

a) Prepare all journal entries to record the activity for the items above for 2020

b) Prepare any journal entries required at December 31, 2020 to record bad debt expense for the year

Growing Crystals Corp. has provided the following information relating to its sales for the past year,
which ended December 31, 2020. The company uses the balance sheet (accounts receivable) method of
accounting for bad debt expense.
Estimated % of accounts receivable that will be uncollectable
5%
Jan. 1, 2020, balance in the allowance for doubtful account
$2,000 cr
(this is before any adjusting entries)
Jan. 1, 2020, balance in the accounts receivable account
$40,000 dr
Credit sales (2020)
$650,000
Write offs of uncollectible accounts receivable (2020)
$6,200
Collections of previously written off amounts (2020)
$900
Cash received in payment of accounts receivable (2020)
$570,000

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

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