Sullivan Equipment Sales showed the following. 2020 Jan. 15 Sold $25,000 of nerchandise for $29, e00 to JanCo; terms 3/5, n/15. 16 krote off Fedun's account in the anount of $15,000. 20 Collected the anount owing tron the January 15 sale. 1 Accepted a $12,000, 68-day, 7% note dated this day in granting Parker Holdings a tine extension on its past-due account. Mar. Apr. 15 Sold nerchandise costing $62,000 for $71,000 to custoners who used their Visa credit cards. Assune Visa charges a 1% fee and deposits the cash electronically into the retaller's account innediately at the time of sale. ? Parker Holdings honoured the note dated March 1. 1 Accepted a $24,e00, three-nonth, 6X note dated this day in granting Grant Conpany a time extension on its past-due Nov. account. Dec. 31 Sullivan's year-end. Interest was accrued on outstanding notes receivable. 31 Bad debts are based on an aging analysis that estinated $9,700 of accounts receivable are uncollectible. Allowance for Doubtful Accounts showed an unad justed credit balance of $1,600 on this date. 2021 ? Grant Company dishonoured its note dated November 1, 2020. 5 Recovered $1, 5ee fron Derek Holston that was previously written off. 14 Wrote off the Grant Conpany account. Mar.

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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Sullivan Equipment Sales showed the following.
2020
Jan. 15 Sold $25,000 of nerchandise for $29, e00 to JanCo; terms 3/5, n/15.
16 krote off Fedun's account in the anount of $15,000.
20 Collected the anount owing tron the January 15 sale.
1 Accepted a $12,000, 68-day, 7% note dated this day in granting Parker Holdings a tine extension on its past-due account.
Mar.
Apr. 15 Sold nerchandise costing $62,000 for $71,000 to custoners who used their Visa credit cards. Assune Visa charges a 1% fee
and deposits the cash electronically into the retaller's account innediately at the time of sale.
? Parker Holdings honoured the note dated March 1.
1 Accepted a $24,e00, three-nonth, 6X note dated this day in granting Grant Conpany a time extension on its past-due
Nov.
account.
Dec. 31 Sullivan's year-end. Interest was accrued on outstanding notes receivable.
31 Bad debts are based on an aging analysis that estinated $9,700 of accounts receivable are uncollectible. Allowance for
Doubtful Accounts showed an unad justed credit balance of $1,600 on this date.
2021
? Grant Company dishonoured its note dated November 1, 2020.
5 Recovered $1, 5ee fron Derek Holston that was previously written off.
14 Wrote off the Grant Conpany account.
Mar.

b. Prepare entries as approprlate for each date. (Round the final answers to 2 decimal places. Use 365 days an year.)
View transaction lat
Journal entry worksheet
2
3
4
5
8
15
.....
Record the credit sales; terms 3/5, n/15.
Note: Enter debits before credits.
Transactions
General Journal
Debit
Credit
a.
Record entry
Clear entry
View general Journal

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Sullivan’s receivable turnovers at December 31, 2020 and 2021 were 7 and 7.5, respectively. Select the correct option for whether the change in the ratio for Sullivan was favourable or unfavourable.

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