Sig Co. began operations on January 1, 20X7. On December 31, 20X7, Sig provided for uncollectible accounts based on 1% of annual credit sales. On january 1, 20X8, Sigma changed its method of determining its allowance for uncollectible accounts by applying certain percentages to the accounts receivable aging as follows:

In addition, sigma wrote off all accounts receivable that were over one year old. The following additional information relates to the years ended December 31, 20X8, and 20X7:

Required:

1. Prepare all journal entries for 20X7 and 20X8

2. Post to "T" accounts

3. Report your answers in the following Chart

Transcribed Image Text:

--Percent deemed to be uncollectible Days past invoice date- 0-30 31-90 91-180 20 over 180 80 --20X8- -20X7 Credit Sales- -$3,000,000- -$2,800,000 Collections-- -2,915,000- -2,400,000 Accounts written off- --27,000-- -None Recover of accounts Previously written off- --7,000-- -None --20X8- --20X7 Days past invoice date at 12/31 0-30 300,000_ _250,000 31-90 80,000 _90,000 91-180 _60,000 _45,000 Over 180 _25,000 _15,000