Question
Clear the Way (CTW) provides snow clearing services. The company uses the percentage of sales method to estimate bad debts for internal monthly reporting purposes.
Clear the Way (CTW) provides snow clearing services. The company uses the percentage of sales method to estimate bad debts for internal monthly reporting purposes. At the end of each quarter, the company adjusts its records using the aging of accounts receivable method. The company entered into the following transactions during the first quarter of 2020: 1. During January, CTW provided services for $9,000 on account. 2. On January 31, CTW estimated bad debt using 1% of sales. 3. On February 5, CTW wrote off a customer balance of $1,500 that was deemed uncollectible. 4. On March 1, CTW loaned $4,000 to an employee who signed a 12% note, due in three months. 5. On March 31, CTW adjusted for uncollectible accounts, based on the aging analysis presented below, which includes the preceding transactions (and others not listed). Prior to the adjustment, the Allowance for Doubtful Accounts had an unadjusted credit balance of $700. 6. On March 31, CTW accrued interest earned on the note. Accounts Receivable Amount Estimated Uncollectible (%) Total 0-30 Days 31-60 Days 61-90 Days Over 90 Days $11,300 $5,500 $4,200 $1,100 $500 5% 10% 30% 60% Required: Prepare journal entries for each of items 1 to 6. Record your answers in the space provided below. NOTE: Use full proper account names, as shown in class and in the textbook: do NOT use abbreviations. Enter all amounts in whole dollars only, with NO special characters (dollar sign, comma, etc.) of any kind. Item #Account Name(s) 1. 2. 3. 5. 6. Debit Credit Activate Windows Go to Settings to activate Win
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