The trial balance before adjustment for Marigold Company shows the following balances. Accounts Receivable Allowance for Doubtful Accounts Sales Revenue 1. 2. 3. Dr. 4. $84,600 Using the data above, give the journal entries required to record each of the following cases. (Each situation is independent.) 2,650 Cr. $447,400 To obtain additional cash, Marigold factors without recourse $29,200 of accounts receivable with Stills Finance. The finance charge is 12% of the amount factored. To obtain a 1-year loan of $57,500, Marigold pledges $71,400 of specific receivable accounts to Crosby Financial. The finance charge is 8% of the loan; the cash is received and the accounts turned over to Crosby Financial. The company wants to maintain Allowance for Doubtful Accounts at 7% of gross accounts receivable. Based on an aging analysis, an allowance of $5,717 should be reported. Assume the allowance has a credit balance of $998. (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. List all debit entries before credit entries.)

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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.