Question #2

Christy Company uses the allowance method for estimating uncollectible accounts.

Jan 5 Sold merchandise to Amy Fergenbaum for $ 1,000, terms n/15.

Apr 15 Received $ 200 from Amy Fergenbaum on account.

Aug 21 Wrote off as uncollectible the balance of the Amy Fergenbaum account when she declared bankruptcy.

Oct 5 Unexpectedly received a cheque for $ 250 from Amy Fergenbaum. Christy does not expect to receive any more payments from Fergenbaum.

Required:

Prepare journal entries to record the following transactions. (Ignore any cost of goods sold entry in the sales transactions).