The adjusted trial balance columns of the worksheet for Mr. Blue Sky Enterprises include these accounts: Inventory $50,000 Sales Revenue 200,000 Sales Discounts 2,000 Sales Returns and Allowances 3,000 Cost of Goods Sold 120,000 Prepare closing entries as needed just to close the accounts above. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit (To close revenue.) (To close debit balance accounts.)
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.
The adjusted
| Inventory | $50,000 | |
| Sales Revenue | 200,000 | |
| Sales Discounts | 2,000 | |
| Sales Returns and Allowances | 3,000 | |
| Cost of Goods Sold | 120,000 |
Prepare closing entries as needed just to close the accounts above. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
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Account Titles and Explanation
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Debit
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Credit
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(To close revenue.)
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(To close debit balance accounts.)
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