E7-4 Kieschnick Company has a balance in its Accounts Receivable control account of $10,000 on January 1, 2017. The subsidiary ledger contains three accounts: Bixler Com pany, balance $4,000; Cuddyer Company, balance $2,500; and Freeze Company. During January, the following receivable-related transactions occurred. Credit Sales Collections Returns Bixler Company Cuddyer Company Freeze Company $9,000 7,000 8,500 $8,000 2,500 $-0- 3,000 9,000 -0- Instructions (a) What is the January 1 balance in the Freeze Company subsidiary account? (b) What is the January 31 balance in the control account? (c) Compute the balances in the subsidiary accounts at the end of the month. (d) Which January transaction would not be recorded in a special journal?

E7-4 Kieschnick Company has a balance in its Accounts Receivable control account of $10,000 on January 1, 2017. The subsidiary ledger contains three accounts: Bixler Com pany, balance $4,000; Cuddyer Company, balance $2,500; and Freeze Company. During January, the following receivable-related transactions occurred. Credit Sales Collections Returns Bixler Company Cuddyer Company Freeze Company $9,000 7,000 8,500 $8,000 2,500 $-0- 3,000 9,000 -0- Instructions (a) What is the January 1 balance in the Freeze Company subsidiary account? (b) What is the January 31 balance in the control account? (c) Compute the balances in the subsidiary accounts at the end of the month. (d) Which January transaction would not be recorded in a special journal?

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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Concept explainers

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.

Question

E7-4 Kieschnick Company has a balance in its Accounts Receivable control account of
$10,000 on January 1, 2017. The subsidiary ledger contains three accounts: Bixler Com
pany, balance $4,000; Cuddyer Company, balance $2,500; and Freeze Company. During
January, the following receivable-related transactions occurred.
Credit Sales
Collections
Returns
Bixler Company
Cuddyer Company
Freeze Company
$9,000
7,000
8,500
$8,000
2,500
9,000
$-0-
3,000
-0-
Instructions
(a) What is the January 1 balance in the Freeze Company subsidiary account?
(b) What is the January 31 balance in the control account?
(c) Compute the balances in the subsidiary accounts at the end of the month.
(d) Which January transaction would not be recorded in a special journal?

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