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Cumber Ltd. has been in business for several years and has the following information for its operation which ended December 31, 2024: 1 2 3 4 Total sales for the year were $3.490.000, of which 60% were on account The company estimates that total expected credit losses at December 31, 2024 will be $94,230 Cullumber Ltd. began the year with $650,000 in accounts receivable and a normal credit to the allowance for expected credit losses of $67,000 Cullumber Ltd. writes off customer accounts that have been outstanding for more than 120 days. During the year, accounts with a carrying amount of $72.000 reached the 120-day mark and were written off The company uses a collection agency to try to collect accounts that have been written oft. The collection agency was able to collect $22.000 from customers whose accounts had previously been written off During the year the company collected $1,770,000 of its accounts receivatde

Cumber Ltd. has been in business for several years and has the following information for its operation which ended December 31, 2024: 1 2 3 4 Total sales for the year were $3.490.000, of which 60% were on account The company estimates that total expected credit losses at December 31, 2024 will be $94,230 Cullumber Ltd. began the year with $650,000 in accounts receivable and a normal credit to the allowance for expected credit losses of $67,000 Cullumber Ltd. writes off customer accounts that have been outstanding for more than 120 days. During the year, accounts with a carrying amount of $72.000 reached the 120-day mark and were written off The company uses a collection agency to try to collect accounts that have been written oft. The collection agency was able to collect $22.000 from customers whose accounts had previously been written off During the year the company collected $1,770,000 of its accounts receivatde

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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Cullumber Ltd has been in business for several years and has the following information for its operations which ended December 31, 2024: 1 2 3 4 5 6. Total sales for the year were $3,490,000, of which 60% were on account The company estimates that total expected credit losses at December 31, 2024 will be $94,230 Cullumber Ltd. began the year with $650,000 in accounts receivable and a normal credit to the allowance for expected credit losses of $67,000 Cullumber Ltd. writes off customer accounts that have been outstanding for more than 120 days During the year, accounts with a carrying amount of $72,000 reached the 120-day mark and were written off The company uses a collection agency to try to collect accounts that have been written off. The collection agency was able to collect $22.000 from customers whose accounts had previously been written off During the year the company collected $1,770,000 of its accounts receivable. Prepare a summary journal entry for the credit sales and journal entries to record the above transactions on the books of Cullumber Ltd. on December 31, 2024. (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. List all debit entries before credit entries) Account Titles and Explanation Accounts Receivable Sales Revenue (To record credit sales) Credit Losses Allowance for Expected Credit Losses (To recognize the credit losses) (To recognize the credit losses) Allowance for Expected CreditLosses Accounts Receivable (To write off accounts judged uncollectible) Accounts Receivable Allowance for Expected Credit tosses (To reinstate an account that was previously written off) Cash Accounts Receivable (To record subsequent collection of accounts that were previously written off) Cash Accounts receivable Debit Allowance for expected credit losses $ 902000 2094000 111230 94200 72000 22000 22000 Accounts Receivable Calculate the Dec 31, 2024 balances for Accounts receivable and the Allowance for Expected Credit Losses 1770000 Credit IN DO 209 4000 94230 72000 22000 22000
Transcribed Image Text:Cullumber Ltd has been in business for several years and has the following information for its operations which ended December 31, 2024: 1 2 3 4 5 6. Total sales for the year were $3,490,000, of which 60% were on account The company estimates that total expected credit losses at December 31, 2024 will be $94,230 Cullumber Ltd. began the year with $650,000 in accounts receivable and a normal credit to the allowance for expected credit losses of $67,000 Cullumber Ltd. writes off customer accounts that have been outstanding for more than 120 days During the year, accounts with a carrying amount of $72,000 reached the 120-day mark and were written off The company uses a collection agency to try to collect accounts that have been written off. The collection agency was able to collect $22.000 from customers whose accounts had previously been written off During the year the company collected $1,770,000 of its accounts receivable. Prepare a summary journal entry for the credit sales and journal entries to record the above transactions on the books of Cullumber Ltd. on December 31, 2024. (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. List all debit entries before credit entries) Account Titles and Explanation Accounts Receivable Sales Revenue (To record credit sales) Credit Losses Allowance for Expected Credit Losses (To recognize the credit losses) (To recognize the credit losses) Allowance for Expected CreditLosses Accounts Receivable (To write off accounts judged uncollectible) Accounts Receivable Allowance for Expected Credit tosses (To reinstate an account that was previously written off) Cash Accounts Receivable (To record subsequent collection of accounts that were previously written off) Cash Accounts receivable Debit Allowance for expected credit losses $ 902000 2094000 111230 94200 72000 22000 22000 Accounts Receivable Calculate the Dec 31, 2024 balances for Accounts receivable and the Allowance for Expected Credit Losses 1770000 Credit IN DO 209 4000 94230 72000 22000 22000
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