Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Part B The company completed the following transactions during 2020. Jan 10 sold inventory to Natty Paul, $11,000, on account May 15 wrote off as

Part B

The company completed the following transactions during 2020.

  • Jan 10 sold inventory to Natty Paul, $11,000, on account
  • May 15 wrote off as uncollectible the accounts of Terry Carter, $2,500 and Maggie Cube $400
  • August 04 received 70% of the amount owed by Natty Paul and wrote off the remainder as uncollectible
  • October 26 received 30% of the funds owed from Maggie Cube as part payment of her account which had been written off earlier as uncollectible.
  • December 31, The Aging schedule showed an estimated $116,500 as uncollectible

Requirements:

  1. Prepare journal entries for each transaction (No narrations required)
  2. Prepare the Allowance for Uncollectible and the Accounts Receivable accounts based on the information presented and balance off each account.
  3. Prepare the balance sheet extract as at Dec 31, 2020, to show the net realizable value for the Accounts Receivable.
  4. Assume credit sales for 2019 were $312,000 and that on December 31, 10% of credit sales are estimated to be uncollectible. Using the percentage of sales method:
  1. Determine the amount to be charged to the uncollectible expense account.
  2. Prepare the Allowance for uncollectible account.
  3. Prepare the balance sheet extract to show the net realizable value of the Accounts Receivable as at December 31.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

College Accounting

Authors: Tracie Nobles, Cathy Scott, Douglas McQuaig, Patricia Bille

11th edition

978-1111528300, 1111528128, 1111528306, 978-1111528126

More Books

Students also viewed these Accounting questions

Question

Describe six biases affecting perception.

Answered: 1 week ago

Question

State the three objectives of the book.

Answered: 1 week ago