need help fixing where its red Required information P6-7 (Algo) (Supplement) Recording Sales, Returns, and Bad Debts [The following information applies to the questions displayed below.] The following data were selected from the records of Sykes Company for the year ended December 31, Current Year. Balances January 1, Current Year Accounts receivable (various customers) Allowance for doubtful accounts $ 116,000 7,000 Transactions during current year a. Sold merchandise for cash, $240,000. b. Sold merchandise to R. Smith; invoice price, $9,000. c. Sold merchandise to K. Miller, invoice price, $36,000. c In the following order, except for cash sales, the company sold merchandise and made collections on credit terms 4/10, n/30 (assume a unit sales price of $800 in all transactions). d. Two days after purchase date, R. Smith returned one of the units purchased in (b) and received account credit. e. Sold merchandise to B. Sears; invoice price, $23,000. f. R. Smith paid his account in full within the discount period. g. Collected $90,000 cash from customer sales on crédit in prior year, all within the discount periods. h. K. Miller paid the invoice in (c) within the discount period. 1. Sold merchandise to R. Roy; invoice price, $26,500. J. Three days after paying the account in full, K. Miller returned seven defective units and received a cash refund. k. After the discount period, collected $5,000 cash on an account receivable on sales in a prior year. 1. Wrote off a prior year account of $4,000 after deciding that the amount would never be collected. m. The estimated bad debt rate used by the company was 1.5 percent of credit sales net of returns.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Required information
P6-7 (Algo) (Supplement) Recording Sales, Returns, and Bad Debts
[The following information applies to the questions displayed below.]
The following data were selected from the records of Sykes Company for the year ended December 31, Current Year.
Balances January 1, Current Year
Accounts receivable (various customers)
Allowance for doubtful accounts
$116,000
7,000
In the following order, except for cash sales, the company sold merchandise and made collections on credit terms 4/10,
n/30 (assume a unit sales price of $800 in all transactions).
Transactions during current year
a. Sold merchandise for cash, $240,000.
b. Sold merchandise to R. Smith; invoice price, $9,000.
c. Sold merchandise to K. Miller; invoice price, $36,000.
d. Two days after purchase date, R. Smith returned one of the units purchased in (b) and received account credit.
e. Sold merchandise to B. Sears; invoice price, $23,000.
f. R. Smith paid his account in full within the discount period.
g. Collected $90,000 cash from customer sales on crédit in prior year, all within the discount periods.
h. K. Miller paid the invoice in (c) within the discount period.
1. Sold merchandise to R. Roy; invoice price, $26,500.
J. Three days after paying the account in full, K. Miller returned seven defective units and received a cash refund.
k. After the discount period, collected $5,000 cash on an account receivable on sales in a prior year.
1. Wrote off a prior year account of $4,000 after deciding that the amount would never be collected.
m. The estimated bad debt rate used by the company was 1.5 percent of credit sales net of returns.
Transcribed Image Text:need help fixing where its red Required information P6-7 (Algo) (Supplement) Recording Sales, Returns, and Bad Debts [The following information applies to the questions displayed below.] The following data were selected from the records of Sykes Company for the year ended December 31, Current Year. Balances January 1, Current Year Accounts receivable (various customers) Allowance for doubtful accounts $116,000 7,000 In the following order, except for cash sales, the company sold merchandise and made collections on credit terms 4/10, n/30 (assume a unit sales price of $800 in all transactions). Transactions during current year a. Sold merchandise for cash, $240,000. b. Sold merchandise to R. Smith; invoice price, $9,000. c. Sold merchandise to K. Miller; invoice price, $36,000. d. Two days after purchase date, R. Smith returned one of the units purchased in (b) and received account credit. e. Sold merchandise to B. Sears; invoice price, $23,000. f. R. Smith paid his account in full within the discount period. g. Collected $90,000 cash from customer sales on crédit in prior year, all within the discount periods. h. K. Miller paid the invoice in (c) within the discount period. 1. Sold merchandise to R. Roy; invoice price, $26,500. J. Three days after paying the account in full, K. Miller returned seven defective units and received a cash refund. k. After the discount period, collected $5,000 cash on an account receivable on sales in a prior year. 1. Wrote off a prior year account of $4,000 after deciding that the amount would never be collected. m. The estimated bad debt rate used by the company was 1.5 percent of credit sales net of returns.
Required information
8
9
10
11
12
13
h.
L
S
k
L
m
Casi
Sales discounts
Accounts receivable (prior year)
Cash
Sales discounts.
Accounts receivable (K. Miller)
Accounts receivable (R. Roy)
Sales revenue
Sales returns and allowances
Sales discounts
Cash
Cash
Accounts receivable (prior year)
Allowance for doubtful accounts
Accounts receivable (prior year)
Bad debt expense
Allowance for doubtful accounts
900
000
30
000
00
30
✪
au,uvu
36,000
1,440
26,000
5,600
5,000✔
4,000
9
6,120
34,560
26,000 x
280 x
5,320 *
5,000
4,000
6,120x
Reta
Transcribed Image Text:Required information 8 9 10 11 12 13 h. L S k L m Casi Sales discounts Accounts receivable (prior year) Cash Sales discounts. Accounts receivable (K. Miller) Accounts receivable (R. Roy) Sales revenue Sales returns and allowances Sales discounts Cash Cash Accounts receivable (prior year) Allowance for doubtful accounts Accounts receivable (prior year) Bad debt expense Allowance for doubtful accounts 900 000 30 000 00 30 ✪ au,uvu 36,000 1,440 26,000 5,600 5,000✔ 4,000 9 6,120 34,560 26,000 x 280 x 5,320 * 5,000 4,000 6,120x Reta
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