Buckeye Incorporated had the following balances at the beginning of November.BUCKEYE INCORPORATED Trial Balance November 1Accounts Debits CreditsCash $ 3,200Accounts Receivable 600Supplies 700Equipment 9,400Accounts Payable $ 2,000Notes Payable 4,000Common Stock 7,000Retained Earnings 900Totals $13,900 $13,900The following transactions occur in November. November 1 Issue common stock in exchange for $13,000 cash. November 2 Purchase equipment with a long-term note for $3,500 from Spartan Corporation. November 4 Purchase supplies for $1,000 on account. November 10 Provide services to customers on account for $9,000. November 15 Pay creditors on account, $1,100. November 20 Pay employees $3,000 for the first half of the month. November 22 Provide services to customers for $11,000 cash. November 24 Pay $1,400 on the note from Spartan Corporation. November 26 Collect $7,000 on account from customers. November 28 Pay $1,100 to the local utility company for November gas and electricity. November 30 Pay $5,000 rent for November.Required: 1. Record each transaction. 2. Post each transaction to the appropriate T-accounts. 3. Calculate the balance of each account at November 30. (Hint: Be sure to include the balance at the beginning of November in each T-account.) 4. Prepare a trial balance as of November 30.
Bad Debts
At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Buckeye Incorporated had the following balances at the beginning of November.
BUCKEYE INCORPORATED
Accounts Debits Credits
Cash $ 3,200
Accounts Receivable 600
Supplies 700
Equipment 9,400
Accounts Payable $ 2,000
Notes Payable 4,000
Common Stock 7,000
Retained Earnings 900
Totals $13,900 $13,900
The following transactions occur in November.
November 1 Issue common stock in exchange for $13,000 cash.
November 2 Purchase equipment with a long-term note for $3,500 from Spartan Corporation.
November 4 Purchase supplies for $1,000 on account.
November 10 Provide services to customers on account for $9,000.
November 15 Pay creditors on account, $1,100.
November 20 Pay employees $3,000 for the first half of the month.
November 22 Provide services to customers for $11,000 cash.
November 24 Pay $1,400 on the note from Spartan Corporation.
November 26 Collect $7,000 on account from customers.
November 28 Pay $1,100 to the local utility company for November gas and electricity.
November 30 Pay $5,000 rent for November.
Required:
1. Record each transaction.
2.
3. Calculate the balance of each account at November 30. (Hint: Be sure to include the balance at the beginning of November in each T-account.)
4. Prepare a trial balance as of November 30.
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