CASH E8.4 STEPS (ASSUME COMPANY USES AN ALLOWANCE METHOD 1. Place beginning balances into T-accounts (see yellow) 2A. Record entries below. (A to D) 2B. Post entries into t-accounts (on right) BEG. BALANCES INOT INCLUDED IN T-ACCOUNTS YET) 3. Calculate total balances of t-accounts. Accounts receivable (beginning balance) 4. Finish E, F, and G. Allowance for doubtful accounts (beginning balance) A2 $ 142,000 11,360 Instructions A1. Record net credit sales of $945,000. beg. A1 ACCTS RECEIVABLE 142,000 A2. Record cash collections from customers in the amount of $910,000. A2 B 2 B. Write off accounts receivable in the amount of $5,200 ALLOWANCE FOR D.F. ACCOUNTS 11,360 beg. C. Collect $1,900 from accounts previously written off. (HINT - TWO ENTRIES] beg. B D D. Prepare the entry to record bad debt expense for the period. The company uses a sales approach with 2% of net credt sales being deemed perhaps uncollectable. SALES A1 E. Determine the ending balances in Accounts Receivable and Allowance for Doubtful Accounts. BAD DEBT EXPENSE D D F. What is the net realizable value of the receivables at the end of the period? CHECK FIGURES BAD DEBT EXPENSE: $18,900 ALLOWANCE FOR D.F. ACCOUNTS $26,960 N.R.V. $ 144,840