Record the following transactions in the spreadsheet template provided for this assignment. 1 . On May 1, 2015, Ahmed & Ahmed Dental Office had five patients who paid with different forms of payment. They use a revenue account called Dental Service Fees. Assume there is no sales tax. Record the following transactions in the general journal: a) A patient pays $70 cash for a regular check-up. - Bank and Dental Service Fees b) A patient pays $125 with a ScotiaBank Visa card. ScotiaBank charges merchants a 4% service fee. - Bank, Credit Card Expense 5 / Dental Service Fees 125 (Dental Service Fees $$ is not 130) C) A patient pays $225 for two fillings with a debit card. The bank charges merchants 15 cents per transaction. - Net amount of 225 and 15 cents will be banked (Dr. Bank), Dr. Debit Card Expense / Cr Dental Service Fees $$5 total you received d) Sarah Smithson promises to pay $150 for dental services at the end of the month. - A/R and Dental Service Fees e) A patient pays for $150 in services with an American Express card. The service fee that American Express charges merchants is 5% - A/R - American Express, Credit Card Expense/ Cr. Dental Service Fees $150 2. Rodriguez Carpentry accepts a six month, 8% promissory note from James Matheson on June 1 to settle a $14,000 outstanding account receivable. Record the following transactions in the general journal: a) The issuing of the note on June 1. - Create a new asset account N/R - Name of business and reduce A/R with the same amount (Cr) b) Full payment of the note on December 1. - How much do you receive from JM in total? 1. Receive the principle amount of 14000 PLUS Interest revenue for 6 months/12 month charge of 8% Calculate: Interest Revenue c) Assume the note is dishonoured on December 1. - Be Careful with the Amount you will debit to A/R. it should principle amount + interest - When you make credit entries - N/R and I/R 3. On February 1, 2015, Samson Design writes off $2,500 of its accounts receivable as bad debts. a. Using the direct write-off method, record this transaction. - Bad Debt Expense and Accounts Receivable b. Which GAAP is (are) violated when the direct write-off method is used? Explain your answer. - two GAAPS are violated In 2015, Decorators Unlimited had net credit sales totaling $1,200,000. Based on past years, 2.5% of account is $12,000. credit sales are estimated to be uncollectible. The balance in the Allowance for Doubtful Accounts a. Record the journal entry to adjust for the estimated bad debts on December 31, 2015 assuming Decorators uses the income statement method. two accounts affected, Adjusting entries for bad debts, Bad Debts Expense/Allowance for Doubtful Accounts by 0.025 of total net credit sales b. On February 1, 2016, the account receivable for B. Stinson of $3,000 is deemed uncollectible. Record the journal entry to write off this account. - Two accounts affected A/R should go down, counter account will be ADA
