Accounts Receivable Journal Entries 3. On January 1 of the current year, Neptune, Inc. had the following accounts on its books: Accounts Receivable Allowance for Doubtful Accounts $240,000 8,000 (debit) (credit) During this year, credit sales were $1,200,000 and collections on account were $1,160,000. Required: a. Prepare general journal entries for the following transactions that occurred during the year: (1) Wrote off N. Purcell's account, $6,800. (2) Wrote off J. Stein's account, $2,400. (3) J. Stein, who is in bankruptcy, paid $800 in final settlement of the account written off in transaction (2). This amount is not included in the $1,160,000 collections. (4) On December 31, estimated the year's bad debts expense at 1% of credit sales. Show how Accounts Receivable and the Allowance for Doubtful Accounts would appear on the year-end b. balance sheet.
Accounts Receivable Journal Entries 3. On January 1 of the current year, Neptune, Inc. had the following accounts on its books: Accounts Receivable Allowance for Doubtful Accounts $240,000 8,000 (debit) (credit) During this year, credit sales were $1,200,000 and collections on account were $1,160,000. Required: a. Prepare general journal entries for the following transactions that occurred during the year: (1) Wrote off N. Purcell's account, $6,800. (2) Wrote off J. Stein's account, $2,400. (3) J. Stein, who is in bankruptcy, paid $800 in final settlement of the account written off in transaction (2). This amount is not included in the $1,160,000 collections. (4) On December 31, estimated the year's bad debts expense at 1% of credit sales. Show how Accounts Receivable and the Allowance for Doubtful Accounts would appear on the year-end b. balance sheet.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 12E: Inferring Accounts Receivable Amounts At the end of 2019, Karras Inc. had a debit balance of 141,120...
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Transcribed Image Text:Accounts Receivable Journal Entries
3.
On January 1 of the current year, Neptune, Inc. had the following accounts on its books:
Accounts Receivable
Allowance for Doubtful Accounts
$240,000
8,000
(debit)
(credit)
During this year, credit sales were $1,200,000 and collections on account were $1,160,000.
Required:
a. Prepare general journal entries for the following transactions that occurred during the year:
(1) Wrote off N. Purcell's account, $6,800.
(2) Wrote off J. Stein's account, $2,400.
(3) J. Stein, who is in bankruptcy, paid $800 in final settlement of the account written off in transaction
(2). This amount is not included in the $1,160,000 collections.
(4) On December 31, estimated the year's bad debts expense at 1% of credit sales.
Show how Accounts Receivable and the Allowance for Doubtful Accounts would appear on the year-end
b.
balance sheet.
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