TRX Company has been forced into receivership, and you have been appointed trustee. You decide to open your own set of books in order to distinguish more clearly between transactions occurring before and after your appointment. The following account balances were reported on September 1, 2020:

In the four months immediately after your appointment, the following transaction occurred:
1. Sales were made in the amount of $296,000, of which $31,500 were cash sales.
2. Receivables were collected in the following amounts:

3. Additional inventory was purchased on account in the amount of $127,500.
4. Cash payments were made as follows:

5. Journal entries were made to record:
(a) Bad debt expense of $21,600, of which $8,600 related to new accounts receivable.
(b) Depreciation expense of $32,400.
(c) Write- off of old accounts receivable of $21,000. The inventory balance at the end of your first four months as trustee (the end of the fiscal year for TRX Company) was $149,700.

Required:
Prepare journal entries to record the foregoing on your set of books. Include appropriate closing entries.

Transcribed Image Text:

Cash Accounts Receivable Inventory Property and Equipment Total Allowance for Uncollectibles Accumulated Depreciation Accounts Payable Capital Stock Retained Earnings (deficit) Total $ 26,700 130,400 191,900 590,400 $939,400 $ 16,000 211,500 308,400 800,000 (396,500) $939,400