At the beginning of the current period, Penny Worth Corporation had balances in Accounts Receivable of $176,000 and in Allowance for Expected Credit Losses of $8,000 (credit). During the period, Penny Worth had credit sales of $704,000 and collections on account of $671,600. Penny Worth expects a return rate of 5%. Penny Worth uses a perpetual inventory system and determined that the cost of goods sold during the period was $589,600. Penny Worth wrote off as uncollectible, accounts receivable of $6,400. However, a $2,800 account previously written off as uncollectible was recovered before the end of the current period. Uncollectible accounts are estimated to total $22,000 at the end of the period. (a) Prepare the entries to record sales, cost of goods sold, and collections during the period. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

At the beginning of the current period, Penny Worth Corporation had balances in Accounts Receivable of $176,000 and in Allowance for Expected Credit Losses of $8,000 (credit). During the period, Penny Worth had credit sales of $704,000 and collections on account of $671,600. Penny Worth expects a return rate of 5%. Penny Worth uses a perpetual inventory system and determined that the cost of goods sold during the period was $589,600. Penny Worth wrote off as uncollectible, accounts receivable of $6,400. However, a $2,800 account previously written off as uncollectible was recovered before the end of the current period. Uncollectible accounts are estimated to total $22,000 at the end of the period. (a) Prepare the entries to record sales, cost of goods sold, and collections during the period. (List all debit entries before credit entries. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.)

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter15: Financial Statement Analysis

Section: Chapter Questions

Problem 56P: The following selected information is taken from the financial statements of Arnn Company for its...

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