Entre Company - Journal entry practice

The following activities pertain to Entre Co. for the current year. Prepare the journal entry that should be made on Entre's books for each activity.

1. All sales were made on account and totaled $650,000.

2. Collections on accounts receivable totaled $585,000.

3. Accounts receivable written off as uncollectible totaled $9,000.

4. Entre collected $50,000 as prepayment for services to be performed by Entre at a later date.

5. Merchandise inventory purchased on account totaled $420,000. Entre Co. uses the perpetual method to account for inventory.

6. Payments to merchandise suppliers totaled $378,000.

7. Equipment having an original cost of $80,000 was sold for $35,000. The accumulated depreciation on this equipment at the date of sale was $50,000.

8. Salaries earned by employees totaled $160,000. Entre records employee salaries by crediting Salaries Payable.

9. Payments to employees for salaries recorded in entry #8 totaled $148,000.

10. During the year, 50,000 shares of Entre's previously unissued $10 par value common stock were issued for $27 per share.

11. Cash dividends of $60,000 were declared by Entre in December and will be paid to shareholders in the first quarter of next year.

12. Patents were purchased for $40,000 cash.

13. The cost of merchandise sold amounted to $407,000.

14. Entre made an end-of-period adjusting entry to recognize that $34,000 of the amount collected in entry #4 was earned in the current year.

15. The balance in the allowance for doubtful accounts was increased by $12,000 in an end-of-period adjusting entry.

16. Patent amortization in the amount of $8,000 was recognized in an end-of-period adjusting entry. Entre Co. credits the Patent account directly (rather than accumulated amortization) for patent amortization