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At January 1, 2018. White Top Flagpoles had Accounts Receivable of $30,000, and Allowance for Bad Debts had a credit balance of $4,000 During the year. White Top Flagpoles recorded the following: (Click the icon to view the transactions.) Read the requirements Requirement 1. Journalize White's transactions that occurred during 2018. The company uses the allowance method. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) (a.) Sales of $178,000 ($162,000 on account $16,000 for cash). Ignore Cost of Goods Sold. (Prepare a single compound journal entry.) Date Accounts and Explanation Debit Credit 2018 (6.) Collections on account $131,000. Date Accounts and Explanation 2018 Debit Credit (10) (c.) Write-offs of uncollectible receivables, S2,000. I Accounts and Explanation Date Debit Credit 2018 15 Requirement 2. Post White's transactions to the Accounts Receivable and Allowance for Bad Debts T-accounts. Enter the beginning balances and the journal entries, and then compute the unadjusted balance of each account. Accounts Receivable Allowance for Bad Debts ||17) |(18) (10) (20) 11 (21) (22) (23) |(25) (28) (27) (16) 124) Requirement 3. Journalize White's adjustment to record bad debts expense assuming White estimates bad debts as 4% of credit sales. Post the adjustment to the appropriate T-accounts. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Debit Credit First journalize White's adjustment to record bad debts expense. Date Accounts and Explanation 2018 Dec 31 (28) Post the adjustment to the appropriate T-accounts. First enter and label the Jan. 1. 2018 balance for the Bad Debt Expense account, then post the adjustment to the appropriate T-accounts. (Enter a "0" on the normal side of the account for any zero balances. Accounts Receivable Allowance for Bad Debts Jan. 1. 2018 Bal. 30,000 131,000 Collections Write-offs 2,000 4,000 Jan. 1. 2018 Bal. Net credit sales 162.000 2.000 Write-offs Unadj. Bal. 59.000 2.000 Unadj. Bal. (33) (38) Bad Debts Expense 1141) (48) Requirement 4. Show how White Top Flagpoles will report net accounts receivable on its December 31, 2018, balance sheet Balance Sheet (Partial): Current Assets: (48) 1: More Info a. Sales of $178,000 ($162,000 on account: $16,000 for cash). Ignore Cost of Goods Sold. b. Collections on account, $131,000. c. Write-offs of uncollectible receivables. $2,000. 2: Requirements 1. Journalize White's transactions that occurred during 2018. The company uses the allowance method. 2. Post White's transactions to the Accounts Receivable and Allowance for Bad Debts T-accounts. 3. Journalize White's adjustment to record bad debts expense assuming White estimates bad debts as 4% of credit sales. Post the adjustment to the appropriate T-accounts. 4. Show how White Top Flagpoles will report net accounts receivable on its December 31, 2018, balance sheet. (1) (2) O Cash Sales Revenue Cash Sales Revenue Accounts Receivable Allowance for Bad Debts Bad Debts Expense Accounts Receivable Allowance for Bad Debts Bad Debts Expense (3) Cash Sales Revenue Cash Sales Revenue Accounts Receivable Allowance for Bad Debts Bad Debts Expense Accounts Receivable Allowance for Bad Debts Bad Debts Expense (5) O Reinstated previously written off account. Wrote off uncollectible accounts Collected cash on account. Record sales for the year. Recorded bad debts expense for the period. (6) O (7) O Cash Sales Revenue Cash Sales Revenue Accounts Receivable Allowance for Bad Debts Bad Debts Expense Accounts Receivable Allowance for Bad Debts Bad Debts Expense (8) (0) 0 Cash Sales Revenue Cash Sales Revenue Accounts Receivable Allowance for Bad Debts Bad Debts Expense Accounts Receivable Allowance for Bad Debts Bad Debts Expense Reinstated previously written off account Wrote off uncollectible accounts (10) O O Collected cash on account. O Record sales for the year. O Recorded bad debts expense for the period. (11) (12) O Cash Sales Revenue Cash Sales Revenue Accounts Receivable Allowance for Bad Debts Bad Debts Expense Accounts Receivable Allowance for Bad Debts Bad Debts Expense (13) (14) O Cash Sales Revenue Cash O Sales Revenue Accounts Receivable O Allowance for Bad Debts Bad Debts Expense Accounts Receivable Allowance for Bad Debts Bad Debts Expense Reinstated previously written off account Wrote off uncollectible accounts. (15) O O Collected cash on account. Record sales for the year. Recorded bad debts expense for the period. (16) Write-offs (17) Write-offs Collections Jan. 1. 2018 Bal Net credit sales Collections Jan. 1. 2018 Bal Net credit sales 20) O Write-offs (21) Write-offs Collections Jan. 1. 2018 Bal. Net credit sales Collections Jan. 1. 2018 Bal. Net credit sales 00000000 22) Write-offs (23) Write-offs (24) Unadj. Bal. Collections Jan. 1. 2018 Bal. Net credit sales Collections Jan. 1. 2018 Bal. Net credit sales 25) (26) di Bali (27) O (28) Unadi Bal Unadi. Bal O Cash Sales Revenue Accounts Receivable Allowance for Bad Debts Bad Debts Expense 29) O (30) Cash Sales Revenue Cash Sales Revenue Accounts Receivable Allowance for Bad Debts Bad Debts Expense Accounts Receivable Allowance for Bad Debts Bad Debts Expense (31) Cash Sales Revenue Accounts Receivable O Allowance for Bad Debts Bad Debts Expense Reinstated previously written off account. Wrote off uncollectible accounts. (33) O Adj. 32) O O Collected cash on account. Record sales for the year. O Recorded bad debts expense for the period. (34) O (35) O (36) O (37) O (38) Adj. Adj. Adj. Dec31 2018 Bal. Dec 31 2018 Bal. (39) (40) (41) O (42) O Dec. 31 2018 Bal. Dec. 31 2018 Bal. Jan. 1. 2018 Bal. Jan. 1. 2018 Bal. (43) O (44) (45) O (46) O Adj. Adj. Dec31 2018 Bal. Dec 31 2018 Bal. Less: Allowance for Bad Debts Sales revenue 47) O Accounts Receivable Add: Allowance for Bad Debts O Bad Debt Expense (48) Less: Allowance for Bad Debts Sales revenue Accounts Receivable Add: Allowance for Bad Debts Bad Debt Expense
