Sheridan, Inc. had net sales in 2020 of $1,449,600. At December 31, 2020, before adjusting entries, the balances in selected accounts were Accounts Receivable $228,400 debit, and Allowance for Doubtful Accounts $3,280 credit. If Sheridan estimates that 8% of its receivables will prove to be uncollectible. Prepare the December 31, 2020, journal entry to record bad debt expense. (If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Dec. 31. 2020 Account Titles and Explanation Bad Debt Expense Allowance for Doubtful Accounts eTextbook and Media List of Accounts Debit 21552 Credit 21552 Attempts: 2 of 3 used Repeat with New Values
Sheridan, Inc. had net sales in 2020 of $1,449,600. At December 31, 2020, before adjusting entries, the balances in selected accounts were Accounts Receivable $228,400 debit, and Allowance for Doubtful Accounts $3,280 credit. If Sheridan estimates that 8% of its receivables will prove to be uncollectible. Prepare the December 31, 2020, journal entry to record bad debt expense. (If no entry is required, select "No Entry" for the account titles and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Dec. 31. 2020 Account Titles and Explanation Bad Debt Expense Allowance for Doubtful Accounts eTextbook and Media List of Accounts Debit 21552 Credit 21552 Attempts: 2 of 3 used Repeat with New Values
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.
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Transcribed Image Text:Sheridan, Inc. had net sales in 2020 of $1,449,600. At December 31, 2020, before adjusting entries, the balances in selected accounts
were Accounts Receivable $228,400 debit, and Allowance for Doubtful Accounts $3,280 credit. If Sheridan estimates that 8% of its
receivables will prove to be uncollectible.
Prepare the December 31, 2020, journal entry to record bad debt expense. (If no entry is required, select "No Entry" for the account titles
and enter o for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Date
Dec. 31,
2020
Account Titles and Explanation
Bad Debt Expense
Allowance for Doubtful Accounts
eTextbook and Media
List of Accounts
Debit
21552
Credit
21552
Attempts: 2 of 3 used Repeat with New Values
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